- Home flipping has become a more attractive and lucrative investment due to pandemic-driven housing market conditions.
- Low mortgage rates, increased home availability, and higher sale prices of renovated properties have all encouraged investors.
- The benefits of real estate investments include lower prices, remote work opportunities, low-interest rates, and tax breaks.
- To start with home flipping, purchase a property at a low price, research the market, make renovations and upgrades as needed, and market it for sale.
- Due to the current real estate market conditions, now is an opportune time to start home flipping.
Before the pandemic, flipping homes was a popular investment strategy for many real estate entrepreneurs. But the current state of the housing market, coupled with an increased demand for homes amidst a global pandemic, has made home flipping more lucrative than ever before. If you’re considering starting a business or investing your money, now is the best time to become a home flipper.
Home Flipping Today
It’s estimated that about 407,000 homes were flipped in 2022. The number has increased drastically since 2020, and many home flippers have seen a great investment return. Home flipping has become more attractive to investors due to low mortgage rates, increased available inventory of homes, and higher sale prices for renovated properties.
In addition to making a profit from selling the homes you flip, other benefits come with investing in real estate. Here are some of them:
Low Prices
While the pandemic has caused a spike in demand for single-family homes, the supply has not kept up. This, coupled with a pause in new construction projects, has kept prices lower than expected. As a result, you can buy a home for less money than you might have a year or two ago, meaning you may realize a profit more quickly when you sell.
Remote Work
With so many companies embracing remote work, many Americans move out of major cities and to suburbs or more rural areas. This has created a demand for homes in previously overlooked areas, meaning you might be able to flip a home in a market that would have once been considered unprofitable.
Low-Interest Rates
The current interest rates for mortgages are historically low. If you need to take out a loan to buy a home, you can do so at an affordable rate. This also means that more people can buy homes, increasing demand and the potential for eventual profits.
Tax incentives
Finally, the government has created tax incentives to encourage people to invest in real estate, including tax breaks for property depreciation and setting up a real estate business. This means that you can potentially save money on taxes while making money through flipping homes.
Potential For High Profits
Perhaps most importantly, flipping homes can be incredibly profitable. With the right investment strategy, a bit of time, effort, and expertise, you can earn significantly more than you would through other investments.
How to Get Started
Now you know the benefits of joining home flippers today, you might be thinking about how you can get started. Here are five steps you should follow:
Purchase Your First Property
Your first property can make a huge difference in how you start your home-flipping career. Choose a cheap home that’s easy to flip. Additionally, don’t use your savings or your money. Look for affordable conventional mortgages you can use to purchase your first property. These mortgages can also help you get better terms on your second property.
Research Your Market
Once you’ve purchased the home, it’s essential to research the local market. Learn about current trends and what types of homes are selling quickly. This information can help you decide about renovations and upgrades for the property.
Renovations & Upgrades
The next step is to make necessary repairs, renovations, and upgrades to improve the home’s value. Typical projects include replacing fixtures, updating appliances, painting walls, or remodeling bathrooms and kitchens. However, don’t go overboard with expensive upgrades; focus on low-cost updates that will improve the home’s overall appeal without breaking the bank.
Set a Reasonable Price
When setting a price for the home, it’s essential to be realistic. Don’t overestimate the value of your property; buyers will research the local market and compare prices before making an offer. Consider similar homes for sale in the area and set a competitive price that won’t scare away potential buyers.
Market & Sell Your Property
Finally, you need to get your property noticed by potential buyers. You can do this by marketing your home through listings, websites, flyers, or open houses. Once you’ve got interested buyers, take some time to negotiate and close on a fair deal.
If you know what you’re doing, flipping homes can be a great way to make money. It takes time, effort, and the right knowledge to be successful in this business. With the current real estate market and increased demand for homes amidst a pandemic, now is the time to get started with home flipping.