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How to Flip Properties with Ease

Young Couple Stressed Over House Flipping in LevittownHouse flipping in Levittown seems to be an easy concept: buy a bargain property, conduct a little remodeling, and then sell it for a much higher price. There is no denying that house flipping has delivered significant returns to many investors across the country. But flipping houses also involves a high degree of risk; a flipping project can quickly become a nightmare if you aren’t prepared. If you want to try your hand at flipping houses, avoid these common mistakes, or you might find yourself in a real flipping nightmare!

Over-Improving the Property

One of the usual mistakes that can easily turn a house flip into a nightmare is failing to know how much to improve the property. For example, new house flippers frequently go too big in renovations, spending far more than necessary. Overspending can lead to budget difficulties and waste of profits when you sell. Unless the property you bought is in a very high-end area, it is not necessary to go too upscale. The ideal improvements will bring the property up to the level of the other homes in the neighborhood – but not too much beyond that.

Dealing with Property Damage

Another way that a house flip can become a nightmare is if you encounter vandalism, theft, or property damage. If a property has been sitting vacant for some time, it may be more prone to this issue. House flipper Carol Sankar of Charlotte, NC, describes one project in which the home was burglarized multiple times during the remodel. One day near the end of the project, she came to the property to discover that the kitchen cabinets had been stolen right off the walls. A dishwasher and a refrigerator are also missing. Because the property was in an area with few security measures and a low police presence, there was little Sankar could do to get her stolen materials and appliances back.

Costly Mistakes

A third situation that can make a house flip haunt you is when making expensive financial slip-ups. For instance, house flipper Daniil Kleyman in Richmond, VA, acquired a project house for what he assumed to be a wonderful deal. An experienced investor, he did a preliminary market assessment on the property and predicted that he could remodel and sell it for five times his cost. Sadly, Kleyman made a series of mistakes that resulted in losing money on the flip.

Not only did the first contractor he recruited walk off the job with his money and without finishing the job he was hired to do, but Kleyman had also used the wrong comparable properties when estimating his post-remodel sales price. He had to list the property for far less than he had intended. And then the property was burglarized, stripped to the walls, plumbing broken, and flooding in the basement. After restoring the damage and replacing the stolen appliances and fixtures, Kleyman was eventually able to sell the house at a loss to a less-than-interested buyer.

Avoiding Flipping Nightmares

Stories like these show just a few of the issues that come with flipping houses for resale. These investors would have greatly benefited from accurate market data, proven construction professionals, and the expertise of property management professionals from the beginning. In Kleyman’s particular case, by first contacting an industry expert like Real Property Management Prosperity, he would have acquired a detailed market assessment before obtaining the property. He would have known the property’s market value from the start, perhaps changing some of his decisions later.

A professional Levittown property manager would have also supplied Kleyman with the names of trusted remodeling and repair vendors in his area and would have checked in with those vendors every so often, significantly lowering the likelihood that the contractor he hired would take his money and run. Ultimately, the team would have accurately priced and marketed his new property for him, searching for quality tenants willing to pay a competitive monthly rental rate for as long as Kleyman wanted to keep the home. The value of this information and assistance is hard to overstate – it could mean the difference between a successful house flip and a flipping nightmare.

With local property management on your investment team, you’ll have the help of experts dedicated to making every one of your properties one of the best long-term investments you can make. For more information, contact us online today.


Originally published on July 12, 2019.

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