http://www.biggerpockets.com/flippingbook Have you always wanted to flip houses but don’t know how to get started? Let this video be your introduction into the world of house flipping by sharing the 5 steps you need to follow in order to find success as a house flipper.
Hey this is Brandon with Biggerpockets.com and today I’m going to show you how you can flip houses in 5 easy steps for fun and for profit.
Alright! So you want to start flipping houses.
I don’t blame you.
Flipping houses can be fun, exciting, and inspirational, and very dangerous if you don’t do it right. I really don’t want you to crash and burn with your real estate flipping. So let me show you the five steps that I follow when I flip a house.
Step # 1: Plan
What kind of house are you going to flip? Where are you going flip at? And, how are you exactly going to complete it?
These are all really important questions that you need to answer for yourself before you start house shopping.
You need to determine where people in your community are buying houses and start there. Also, what kind of properties are people buying? Three bedrooms? Big garage? Basement?
Until you answer these questions and formulate a plan don’t jump into a house flip.
Step # 2: Get your Financing Figured out
How are you going to pay for this flip?
Because, most bands don’t like funding flips, so, if you don’t have the cash you may need to get creative.
One of the common methods used to fund a flip is the hard money lender. And if you plan on using the hard money lender, you better start looking for them right now and talking with them, building that relationship.
If you don’t know any hard lenders in your area, you can find them for free in your state by visiting biggerpockets hard money lender directory by clicking this link right here or you could watch a video I made on how to find a hard money lender by clicking this link right here.
Alright let’s move on to step # 3: Buy smart
When it comes the time to buy a property not any old property is going to cut it. You’ve got to buy smart. An easy tool to use is called the 70 percent rule. And basically, it goes like this:
First, figure out how much the house will actually sell for once it all fixed up. You might want to talk to a realtor for this. Multiply the number by 70 percent. So, track out your repairs, and badabing badaboom you got an estimate on the price you can pay.
So take some time and actually do the numbers and make sure it works. And be conservative in your estimates. If you think it would sell between 140 and 160, go with 130 and then double your repair cost and then double your timeline. Trust me.
If you want real comfortable and knowing exactly how much it cost to fix up a property then make sure you pick up a copy of biggerpockets presents the book on estimated rehab cost, which comes free when you buy the bigger pockets presents the book on flipping houses — also an amazing book. If you want a copy click on the little book icon right here.
Alright moving on, Step # 4: It’s time to step remodeling the home
If you plan to do all the work yourself (and I don’t recommend it) you better get started. But instead you probably are going to higher some contractors.
Get to really make sure that the contracts are licensed, bonded, and insured. And you got to manage your flip like a business not a hobby. So have rules , systems, budget, and schedules to make sure everything runs smoothly.
Finally Step #5: Sell that flip
Make sure you price your house so quickly, in other words don’t be greedy. You want that house to sell as fast as possible.
You may want to also consider staging your house. Which means decorating them with flowers, furniture, painting, rugs, flowers, whatever you can to make it look “oh so cute.”
So hopefully, if you had a great plan, with conservative with your numbers, manage your flip effectively and sold it quickly. You now made a nice side-able profit that you can roll into the next flip.
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