Flipping Houses – It’s easy right?
HGTV has so many great shows that feature flipping houses as a great way to make money. It looks messy but fun AND you can make a profit! We watch them with voyeuristic pleasure and wonder if we could do the same thing.
What the TV shows do not allow us to see is the aggravation that comes with trying to get all the renovations done on time and within budget.
As someone who has flipped a few houses, albeit over a period of time while living in them, I have to say, it is NOT for the faint of heart.
It’s Flippin’ Fun
I will share with you the short story of one of my homes that I got excited about that had great “bones” as they say. It was an old brick home that was 90 years old and perched on the brow of a city with a great view. I took video of the inside before I purchased it and sent the video to my father who lived 8 hours away. His exact words to me were “Walk away, walk away!”
I balked, so what if the tenants had been evicted and there were holes in the walls, the stairs were falling out of their stringers and there were mice in the dishwasher! This was going to be a great house for a flip – I could feel it! So began the renovation that took a year and a half.
During this time I brilliantly decided to finish university, something I should have finished years before. I had two children at home both under the age of 3 and I thought renovating, working with contractors, going to school and being a mom would be something I could handle. No problem – I was a super mom! In hindsight I look back at those years as the crazy years and tell people never, ever attempt to do that unless you are a wee bit crazy.
With a lot of help, and I mean a lot of help from my father – my husband and I got the job done. There were many days that we sat around the kitchen table with drywall dust covering everything around us. And there were areas of the house we could not live in for periods of time.
Then the moment finally came where the house was perfect and the vision of what I had in mind for this beautiful home was realized… then the For Sale sign went up on the lawn – that same day. Bittersweet!
At that moment I realized that flipping is kind of like a wedding in the sense that you have a vision of what it will look like at the end and then all too soon the event is over. The good news is – I learned a lot from mistakes made and – did make money but it was a lot of time, mess and sacrifice to get there.
What About You?
Do you seek the thrill of turning something ugly into a profit? Do you see potential in older run down homes?Are you up for doing a flip? Are you prepared to eat take out many nights during the week if your kitchen will be under renovations? Or would you rather purchase a flipper that won’t be your primary residence?
Crucial points to think about before
buying a flipper:
- Talk to a Real Estate agent before you begin shopping
- Realtors know the market and know what will sell after you’ve done the renovations
- Choose a Real Estate agent who has flipped or knows what is involved in flipping houses
- Choose the right location! It is key to getting a return on your investment
- Figure out if you can afford to put 20% down on a secondary property (or look for private lenders who only require 10% down)
- Do you have a budget to work with? If so, add 25% to account for unexpected issues that may come up
- What is your timeline for the project? 1 month? 3 months?
- Do you have reliable contractors that you will work with?
- Do you know exactly what adds value to a home in the area you are looking?
- And lastly – are you truly ready to get your hands dirty?
I personally feel that there can be money made in flipping a house but it has to be done right. All too often I see people who have put way too much money in a house and their asking price reflects the money they have invested, they are desperate to get back what they put in. Unfortunately, they didn’t do their research.
Be Smart and do your homework!
If you have any questions about flipping a house in the Oakville or Burlington area, please contact me and I would be happy to give you more information. Jennifer@jenniferbirch.ca or call or text me @ 905-407-3274