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Bridget Alves                of Valencia

Blog - Full Service Real Estate Group, Inc

Tips to make money “flipping” houses

Bridget Alves - Monday, July 04, 2016


Of all the investment vehicles out there, real estate is arguably one of the most accessible. Everything around us is real estate, in one form or another, and investing in it simply requires that one obtain some measure of ownership. That being said, one of the more common ways people invest in real estate is through the practice of “flipping” houses. “Flipping” a house involves the age-old investment trope of “buy low, sell high” but applies it to houses instead of stocks. For those interested in the possibility of “flipping” a house, here are a few tips:


  • Try buying with cash as opposed to loans. Depending on the market in which you’re looking to invest, this can seem like a daunting task. While it isn’t entirely impossible to make money “flipping” a house you bought with a loan, the moment you buy said home you’re already in debt. 
  • “Buy low …” the further below market value you can purchase a home for, the more money you stand to make on the resale. Unfortunately, the vast majority of people know how much their home is worth and won’t be willing to let it go for less. So, how do you buy below market value? You search for that small percentage of people that don’t fit into the aforementioned category. Typically, these people will be what we refer to as “motivated sellers.” These folks, for whatever reason, are in a rush to sell their home. Maybe they have to move for a new job, or maybe they can’t afford the mortgage payment anymore. Either way, the more dire their need is, the more likely they will be to give you a good deal just to get rid of the home.
  • Be cognizant of the home’s location. Knowing where the home is on the map is one thing, knowing where it is regarding market trends in the area is something else. Houses are like stocks in that, if the area where the home is located is experiencing positive yearly gains in terms of home values, it isn’t unreasonable to bet on those gains continuing. The opposite is also true. If the area has been experiencing yearly losses in terms of market value – be very careful.
  • Make as many repairs and upgrades as you can by yourself. Look, finding a “motivated seller” can be a godsend, but it isn’t always going to happen. A lot of people who profit off of “flipping” houses do so by purchasing a home that needs work, putting in said work, and then selling the updated home for more money. In order to maximize the profit, you’ll want to minimize the expense; and that often means making what repairs you can yourself. Every contractor you don’t have to call is one less fee you’re going to have to pay.

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