4 Steps to Break Into House Flipping
Whether you’re a retiree looking for extra income, or you’re a young professional looking for a smart, lucrative investment, you might be interested in house flipping for real estate investing in Naples Florida. Real estate investing can be a fantastic additional stream of income, and you don’t need much capital to get started.
Here are some great tips and resources to help you choose the right home, fund your purchase, and make repairs to get your property ready for tenants or new buyers.
Find the Right Property
Prosperity Flipping states that before buying, you should consider the location, any necessary renovations, and how much you could feasibly earn from the house in the future. And as you peruse local listings, even if the photos and videos are amazing, it’s important to visit potential investment properties in person so you can determine whether or not you should put in an offer. When you view a property you’ll find out more about how much work is truly needed, the priorities, and whether you’ll be able to tackle the bulk of the labor yourself.
Recognizing what is outside of your handyman skills, or outside of your budget, is critical to your success.
Finance Your Investment
Some people might use cash to purchase a home they plan to flip, even if it means selling a vehicle or other belongings to come up with the funds. But you have other options for financing your new property. REFlipper points out that you might qualify for a traditional bank loan, a private loan, or even a home equity loan.
If you plan to take on debt to purchase an investment property, don’t become overleveraged. By taking on a reasonable level of debt, you ensure that the property becomes a financial asset.
Plan Renovations
Flipping a house will typically involve lots of renovation and repair projects! But before you start making plans to remodel rooms and invest in interior design changes, think about which projects will give you the biggest profits in return for the amount of money you spend.
For instance, you could prioritize updating the bathroom and kitchen, as well as fixing up the porch and entryway to make a good first impression. Also, you’ll need to repair any broken or drafty windows in the home.
Managing Your Property
Are you planning to rent, rather than sell, your investment? First, you’ll need to pick a business structure in order to make your rental business official. Each structure comes with different benefits — for example, an LLC offers personal liability protection and a simple management structure. Once you settle on a business type, then you should work on completing each step to legally form your business. If the process seems overwhelming, consider hiring help. For example, a formation service can take care of the logistics for filing an LLC.
Landlords are responsible for upkeep, plus there is advertising, screening tenants, and collecting rent. There are several apps to help you with everything from reminding you to pay your bills to documenting move-in inspections. But if you don’t have the time to handle it all on your own, consider hiring a property manager. A property manager can take care of everything from working with vendors to advertising your property.
Flipping houses is a major financial commitment, so you want to make careful decisions throughout the process. With the right strategy, this can be a very profitable course of action for everyone from retirees to professionals starting out in their careers. By following these tips, you’ll be able to flip a home that provides substantial returns.
When you’re ready to purchase an investment home in Naples, realtors Mike and Anna Bryant from Downing-Frye Realty can help. Call 239.293.0246 to set up a consultation!
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