5 Steps to Beginning Your Own Fix and Flip Business
Thanks in part to popular television shows featuring now-famous fix and flip personalities, interior designers, and contractors, the business is presented as fun and financially stable, but it does take a lot of hard work. Below you will find five steps to help you start this lucrative business yourself.
Step One: Understand the Business
It is important to know there is a lot more to fixing up and selling houses than you see on television. Understanding the business requires a wide array of knowledge, including legal requirements and limitations, the general real estate market and its trends, and the area where you’re buying and reselling. Don’t leap in without studying and training, like any other job.
Step Two: Secure Proper Funding
In a fix and flip business, you will purchase houses to remodel and sell. You will need funds to do so, but you won’t be applying for a traditional mortgage. You will need a fix and flip or rehab loan from a bank or lending institution. These loans are shorter in duration and have a higher interest rate. Hopefully, the loan will be paid back to the lender quickly, as you sell the remodeled home for a profit.
Step Three: Make Use of Your Talents
Help yourself save money by using the talents you have to offer, so you won’t hire a contractor for every part of the fix and flip process. Something as simple as a painting can save you several thousands of dollars when you’re remodeling an old home. There is plenty of work to do yourself before hiring professionals.
Step Four: Create Professional Relationships
Once you have enough cash on hand or turned a profit or two, you may want some professional help. Building relationships with contractors, designers, and decorators will help the refurbished home sell at a higher price, thanks to the professional touches. Besides artisans, you will also want a good relationship with a real estate broker. A broker will help you navigate the market and find good homes to fix and flip.
Step Five: Start With One Project
You need to know that it takes a lot of time and effort to get to a successful point in your fix and flip business. Start by working on one house at a time. Then, over time, you will have the assets to work full-time on your new business.
Fixing up old homes to sell can be a great profession if you take the time to learn the finer points of the business.