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You would be correct if you have heard that fixing and flipping properties can be incredibly profitable. Essentially, the process of buying a property to renovate it, and sell it for a profit, you can make a lot of money from this, as long as you know what you are doing.
To make sure your foray into the exciting world of fixing and flipping goes without a hitch, follow the below step-by-step guide.
A step-by-step guide to fixing and flipping a property
Step 1: Plan your budget
If you want to successfully fix and flip a house, you need to plan your budget carefully. Start by determining your purchase price and then assess the cost of repairs and carrying costs such as utilities, insurance, and taxes.
Step 2: Secure your funding
Now that you know how much you will need to spend, the next step is to secure your funding. If you are new to fixing and flipping and do not have any money put aside to purchase your first property, several funding options are available.
Firstly, you could choose to take out a fix and flip loan, a type of loan specifically aimed at people wanting to fix and flip houses. Alternatively, you could ask your bank for a business loan or take out a personal loan.
Step 3: Do your research
This step is crucial, so make sure you take the time to conduct extensive research before making an offer on a property. Look at properties in your area and also get to know the area itself.
It can also be a good idea to look at property values as this will help you to better understand what a property is worth.
Step 4: Find the perfect property
After you have done your research, you can now begin to look for your perfect property to invest in. You may want to talk to a local real estate agent about the top deals currently available, but consider your budget and what you can realistically afford.
Step 5: Make an offer
Once you have found a property you like, it is now time to make an offer. Although you don’t want to go in to low, you should try and get the best possible price so that you can make the most profit when you resell it.
Step 6: Start the renovation process
Congratulations! You have now bought your first fix and flip property. The next step is to start the renovation process. Depending on the type of property you have bought, this may involve just a few minor repairs, or you might have a big job on your hands.
When it comes to renovating, you need to hire reliable and reputable tradespeople to get the property ready for resale as quickly as possible.
Step 7: List the property for sale
The final step is to list the property for sale so that you can turn your investment into a profit. You can choose to market the property on your own or with the help of a local real estate agent.
