#22. How to Save Money on a Flip by Doing It Yourself
There�s no doubt about it, you can save a ton of money by doing your own renovations on that flip. Of course, there are some things that you cannot touch yourself, unless you have the professional qualifications. These are the plumbing and electricity, but could include other things, depending on your state laws.
However, if you truly want to save money by doing all the work yourself, then you�ll need to establish that you are able to what is required, before you buy the house. That means there should be no structural repairs needed - unless of course, you are a competent handyman.
Painting is one of those things that most people find quite easy to pick up. By following the instructions on the tin, you shouldn�t get into any strife. If there are some things you are not sure of, then advice is free at your local Home Depot store. Don�t forget to start with the ceiling and work down, and then you won�t be splattering new work.
Laying vinyl flooring or even carpet is not terrible hard, either. The main thing to remember is to measure it exactly. Much vinyl is loose lay - that means you don�t have to glue it down. Carpets need to be tacked around the edges, but even that chore is not hard to learn.
Copying something you like out of a decorating book can beautify a room. Simply buy those furnishings that are in the picture and arrange it all the same.
Landscaping is simple as far as skills go. It doesn�t take much know-how to dig a hole for a shrub and pop it in. The nursery will give you free advice if you need it. And most people can mow a lawn. The hardest aspect for all these chores is the physical one. You do need to be fairly strong and fit to accomplish them.
But there is more to the do-it-yourself of a flip than the renovations. There is the buy and sell aspect.� In many cases, you can do at least some of this work yourself and save a great deal of money. Simply using a closing attorney rather than a realtor will save you the 6% fee. This can be quite a slug when you stop to work it out.
Selling your own flip will save you money too. You can advertise it for free in some places like an fsbo website. You could also advertise it on your own website or free blog. There are many ways to save money and the more of them you learn, the more profit will be found in your flip.
#23. How to Make Decorating Choices that Appeal to Buyers
Generally, renovations refer to structural work while decorating refers more to cosmetic looks. When flipping a home it makes sense to only make those decorating choices that appeal to buyers. The buyers are important; if they don�t like the home, then they won�t buy it. And it is usually the woman rather than the man who cares what a house looks like. Most men couldn�t care less what color the walls are or whether the kitchen is poky. They don�t worry if the carpet is the color of vomit or the bathtub is old-fashioned. But the woman does.
If the woman cannot see potential in a home, then she won�t buy it. If it appeals to her, then she will buy it if the price is right. In some cases people intend to repaint before they move in, but often they don�t want any additional expense. They�ve just forked out thousands for the house, why would they want to fork out even more for decorating? So if you can get it right, you�ll have a sale.
But decorating unwisely can eat into your profit like nothing else, so be sure what you do is tasteful and modern. Don�t rush in and paint the walls hot pink with bright orange trim. Some colors welcome us and create a feeling of restful harmony, while other colors cause a feeling of restlessness.
Likewise with patterns; large swirling patterns compete with us for the space in a room. Smaller patterns are easier on the eyes, but too much makes it all feel busy. Lots of plain areas create a restful feeling.
Copy Mother Nature and use earth colors for a restful feeling. Create different textures rather than having numerous patterns. Vary small with large and plain with fancy, but never clash colors, patterns or textures. Keep those loud, cheerful colors for the flowers lining the front path and by the front door. Leave out thorny, spiked plants, especially near the walkways and doors.
Don�t forget to please all the senses, not just the eyes. Wind chimes near an open door or window will tinkle softly in the breeze. A water fountain in the cool greenery could be more pleasing than anything.
Honeysuckle or other scented flowers are sure to please the sense of smell outdoors, while the aroma of freshly baked cookies or bread indoors will certainly make anyone feel welcome. A fresh lemony scent can be enjoyed just as much and is easy to obtain by using lemon-scented cleaning products.
#24. Managing Your Home Flip
Project managing your home flip will ensure that all things are done in a timely manner, thus avoiding certain problems that can crop up.� Everyone wants to enjoy smooth sailing, but unless you plan properly, there won�t be much of that happening. While most people tend to groan at the thought of paperwork, it is a necessary evil and if you have it all in place before you start, then that will be a major factor in plain sailing.
For renovations of any great extent, you�ll be sure to need permits from your local building inspection division. If you don�t get a permit, you�ll get a fine. You�ll also need insurance. Accidents always happen to those who are not prepared. Insurance is one good preparation. If your renovations are not extensive, but you are not going to do them yourself, then you�ll need to draw up a plan of what you want done before you can get a proper quote.
If they are extensive, then a detailed blueprint will be required. Give copies to all the trades you�ll be using such as plumber, builders and electricians, as they can only give a reasonable estimate of costs if they see the plan.
If the power has been disconnected, you�ll need to have a temporary pole set up, to provide power for the workmen. Once the house has been gutted, you�ll also need to provide a portable bathroom. A dumpster is the next step. Make sure it is not placed somewhere that will interfere with access to your own or the neighbor�s place. While the dumpster is there it can be used for garden waste too, so get stuck into pruning those overgrown branches.
Make sure the demolition crew - even if it is family and friends - have gloves and masks at the very least. Sturdy footwear should also be used. Goggles will save eye irritation. Long-sleeves and trousers will protect skin from scratches and irritation from the dust and dirt.
Once the demolition is finished, then it�s time for framing. The framing inspector must come and view the site before and after. Firstly to tell you what�s needed and after to confirm the job is done right. Windows and doors go in next and the electrical and plumbing contractors must get to work.
After that, it�s insulation and finish time. Apply primer to the new walls before any cabinetry takes place. Make sure that all your trades have their work properly inspected at the right times. Once the cabinets and trim are done, you can paint the walls. Tinting the primer to match the topcoat will make the job look more professional.
Flooring goes in last, and then it�s time to do the outside of the home. Landscaping should be left until last. Now you need to take some great photos and load them onto your website.
#25. Is Flipping Real Estate Still a Good Investment
Flipping houses has gained popularity during the past decade as a profitable and exciting endeavor. But the recent drop in the real estate market may pose some additional obstacles.
Using real estate as a financial investment has been considered a wise choice for ages. During a boom, one has the opportunity to purchase a property and then sell it within a year for a considerable profit. Even larger sums can be made when the investor decides to "flip" a house, sending the property value of a home skyrocketing.
Flipping houses has also been around for ages but has gained popularity over the past several years due to a variety of reality shows including Bravo's "Flipping Out."
To flip a house is to buy a particular piece of real estate for a very low price, renovate it to raise the value a great deal and then sell it to make a profit. Typical value raisers include adding bedrooms or bathrooms, adding another story and replacing old, outdated kitchen and bathroom fixtures. Flipping houses can be especially profitable for people who are either able to perform their own construction labor or know a close friend who will do it cheaply. Hiring contractors to come out and do all the work will significantly reduce your net earnings because your costs will be much higher.
But with the undeniable drop in the real estate market during the past few years, is it still a sound investment?
In some ways, the down market has provided a wealth of opportunity to those looking to flip houses. The commonality of foreclosures these days lets house hunters take their pick of fixer-uppers, usually at a extremely low price on the market. Many foreclosed houses go up for auction by the banks that repossessed them, sometimes at unbelievably low prices. The other option for buying a house at a very low cost would be to buy a "fixer-upper," a house that is cheap because it is in need of a lot of work before it can be considered inhabitable or desirable.
To buy a nice, previously foreclosed house is typically the better option because there will be far fewer repairs needed and you can focus on adding features to make the house better rather than just making it decent.
With the buying and repairs out of the way, now comes the difficult part: selling it. As stated before, the value of a home can shoot up quickly when the market is booming. When the market cools off, the opposite happens. This means that people stop considering real estate the sound investment it once was. With the market being so unreliable, people do not know whether their purchase will increase much in value.
Because of this, the asking price for a house has to be considerably lower than what you desire. Even if you are lucky enough to sell the house in such a low-demand market, you will not be able to sell it for as much as you would have in 2002.
The most important factor to look for in this scenario is a qualified, experienced real estate agent with a record for selling property quickly and for a good profit.
#26. The Power of Educating Yourself in Real Estate
Getting ahead is a goal that any businessman wants to do while completing a venture. If you want to get your business going and make sure your capital will yield results, it is important to educate yourself. This is not just applicable in business, but can also be applicable to every part of your life.
�Go Get It Yourself:
Education is a lifelong process as they say, and it does not stop. When it does, that is when you stop growing as a businessman, as an individual. Learning in school, learning the ropes of how things work in an office, and knowing how things work before getting yourself into something is important. But when you are already doing it, does the learning stop? No, it should not. As a matter of fact, you should learn as much as you can and learn more than you already have. Getting out of the classroom means the whole world is out there to be explored. If you want to learn something, go get it yourself. It shouldn�t be spoon-fed; you got to find it.
�Learn from People:
Apart from the actual hands-on training and the information that you get from books and on the internet, you can also learn from the people around you. What are the things that these people do? Analyze why they do things and what results it brings them. Talk to different people everyday and learn about their story. There are stories to be heard and lessons to be learned through other experiences. Experience in itself may teach somebody about their mistakes, but that does not mean it has to be committed when the result is already known based on somebody else�s mishap. If you find yourself in the same situation as they have been, the same situation can be avoided.
�Watch and Learn:
Observe the happenings around you. Being analytical and inquisitive of your environment will push you to learn so many things every single day, even from the most mundane occurrences. Asking why things happen and getting out of your comfort zone to find the answers help increase your knowledge. These are the kind of knowledge that not everybody would spend time finding. If you are really interested in working towards your goal, learn things that would put you ahead of the game. This will add a different perspective to an already monotonous way of looking at things.
Always ask:
Why? � That one question that should keep you finding for answers. Sometimes there are questions that run through your mind that you want to be answered, but you tend not to ask them because you are afraid that you might look uneducated or plainly ignorant. One philosopher said: �You start to know when you do not know.� This means that once you admit your ignorance that is the only time it can be filled with knowledge. Admitting that something is not too familiar to somebody may push them to further learn about it and familiarize themselves with the unknown. As ironic as it may seem, that is the truth.
#27. Flipping HUD Foreclosures
How do you make money flipping HUD foreclosures? Not by buying at half-price.
Those who want to invest in real estate often get excited by HUD foreclosures, thinking that they are going to buy a house for half of what it's worth. Real estate investors know that this isn't too likely. However, there are opportunities for flipping these houses for a profit, so lets see where.
HUD foreclosures are homes that had loans on them guaranteed by the Department of Housing and Urban Development. When owners default, they lose the house. HUD pays off the bank and takes possession of the home, which they try to sell for market value.
In most markets today, they probably do sell close to market value. Government bureaucracies may be inefficient and they certainly make mistakes at times, but then it isn't some bureaucrat putting the price on the houses. Normally HUD's foreclosure houses are sold by real estate agents, and they should have some idea of what a property is worth when they recommend a listing price.
Also, HUD takes bids first from owner-occupant purchasers first. Only after this initial offering period are investors allowed to buy the home. In other words, if there is a truly underpriced home, an investor may never have a chance to buy it anyhow. But there is some good news.
HUD Foreclosures - The Opportunity
Fortunately, there are some opportunities here for the real estate investors who want to do some work. You can sometimes flip a HUD house for a good profit if you're willing to run the numbers and do a little work. Why? Because� HUD foreclosures are sold "as is," and often have enough problems to scare away most home buyers.
They may sell near "market value," but a beat-up house will often have a market value that leaves room for a good profit after fixing it up. The market for such a house is mostly investors, after all, not owner occupants. Real estate investors will pay only what works for making a decent profit.
In other words, the initial offering period that is open only to owner-occupants is not a problem. Think of it as a free service to you. The buyers are screening out the homes that wouldn't sell cheap enough to fix and flip for a profit anyhow. Anything that doesn't scare them away doesn't have much potential, so you are left with the ones that CAN be profitable.
To invest in HUD foreclosures, find a real estate agent that handles them in your area. Look for properties that have problems, but problems for which you can estimate the cost of correction. Get advice from an agent on what the finished home will sell for, subtract from that every last possible cost to fix it up - and subtract your profit. Now you have the highest price you can offer.
#28. The Do�s and Don�ts of Selecting a Tenant
Now that you have renovated your property and it is in livable condition, the next step is to find yourself a good tenant!