Thinking about Flipping a House? Here's What You Need to Know

Buying a house, condo, apartment and flipping it is a proven method for getting more for your money. Each “fixer” is unique in its own way though. Not everyone is the same, and there will be some that just aren’t for you.
 
Flipping a piece of real estate property requires some sweat-equity for a great deal that just needs some attention. Because not all flippers will be the one for you, you must consider each ones value proposition and decide which ones are the money-makers, and which are the money pits. Most of the flippers fall into one of three categories, so here we go.
 
1.       The Cosmetic Fixer
 
This is a house that needs just a little cleanup, some repairs here and there, but nothing major. The sellers here didn’t want to invest much more time or money into the house and have dropped the price a bit in order to sell. The standard fix is all this house requires: new paint, countertops, lighting, landscaping, new carpet, and some new appliances will give this place the face-lift it needs. A couple dozen runs to Lowe’s or Home Depot should do the trick.
 
2.       The Ugly Fixer
This house is considered the ugly duckling. It may be ugly to everyone else, but you can see the real beauty inside. These houses need more extensive repairs and remodeling than the cosmetic fixer. If you are willing to put in the work, you will get the deal others have missed out on. Here are some traits of an ugly fixer.
a.       No curb appeal: fresh landscaping will fix this problem quickly. A newly painted door, new mailbox, and new house numbers will be the finishing touch.
b.      Great bones in bad shape: quality construction and architectural lines have been underutilized.
c.       Dark interiors masked with ugly décor: ugly décor is a major turnoff for potential buyers, but this is easily solved when the moving van leaves the premises.
d.      Old kitchens: renovate that kitchen because it’s the most important room in the house. It’s where families spend most of their time. It will also give you the biggest return on your dollar.
e.      Old bathrooms: bringing in outside help for possible bathroom renovations is highly recommended. An expert plumber will give you an insight as to an awesome bathroom.
f.        Terrible smells:  whether it’s from cigarettes or dirty pets, these foul smells are a HUGE turnoff for buyers. As the professional you are, you know new carpets, new paint, and new drapes will take care of that smell.
g.       Leaky roofs and water stained ceilings: not only are these annoying, but ugly. Putting on a new roof will fix this problem, but you were going to do it anyway.
h.      Claustrophobic rooms: look for a potential wall to (safely) remove that will open up rooms to a kitchen, or living room.
 
3.       The fixer Teardown
This one is the absolute, no doubt about it, money pit. These are the houses that you DO NOT want. The purchases for repairs might be inexpensive, but sometimes these problems never go away, and are unfixable. No matter how much you invest, sometimes with these homes you will not see a return on your investment.
Here are some signs that this house is a fixer teardown.               
a.       Structural problems beyond repair
b.      Major ground shifting caused by poor foundation work
c.       Flooding of basement time and time again
d.      Illegal room additions that do not comply with building codes
e.      Damage from floor, fire, and earthquake
f.        Mold issues
g.       Unstable hillsides near the house, or shifting of the house due to soil erosion or flooding.
Buying a fixer home is quite a risky investment, but sometimes they can be very profitable. Watch out and evaluate what type of fixer each house might look like when searching for your home. You’ll avoid a good portion of the hassle and headache down the road when you know what you are looking at.

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