Real-estate Flipping – Is Flicking Real Estate the best way to begin in real estate investing?
“Flip This kind of House”, “Flip That House”, “Property Ladder”,… and on and…
Over the earlier couple years both you and I have recently been hammered on TV with real estate flipping implies that depict these people making outrageous profits flipping homes and so that it is look easier than heck. commercial real estate montreal
So, is this flipping stuff real? Well… it sure is. There are many people out there making a darn good living flicking homes. But… the tv set shows on flipping are darn deceiving when it comes to the “reality” of real estate wholesaling.
Is flipping real house the best way to get starting in real estate investing? I’ll allow you to decide for yourself. On the other hand, for me, for most people, especially in today’s down markets (not all market segments are down… there are actually some doing really well), real estate flicking is not the best way to get started out in real estate courses.
First, let’s clarify two sorts of flipping.
The Fix and Flip – Where you buy real estate, treatment it, and sell it to a retail buyer. The kind that is on the TV shows.
The General Flip – Where you buy real estate (or get it under contract), find a wholesale buyer, and flip the deal. The kind that is less glorious… but has a ton of money in it… with a heck of a great deal less risk.
To myself, the Fix and Switch method is not for most newbie’s… even though that is the sort of real estate investing the truth is on TV all of the time.
You desire a good understanding of treatment costs
You need to have good funding… either from a private lender or a bank (private lender is preferable)
You have to be able to float the carrying costs if you can’t sell the home quickly
If you don’t estimate your costs just right… there may well not be a whole lot of room for error… and room for error means better risk on you!
The market is at a downward spiral… so there are less retail buyers out there for middle income homes… which is what most people start out flicking
There are numerous people out there making a very good living flipping… but almost all of them started several years ago… and have many flips under their devices.
They already have systems down, have marketing stations for getting buyers, have solid lending sources, and so on. Not to say that new real estate shareholders cannot do all the above… YOU CAN!
But, there are better ways to get were only available in real real estate investing that allow you to get in with little or no risk or money, and will allow you to find out Fix and Flip business before you ever require a huge money commitment to accomplish this.
What’s the single best way (in my opinion) to get started in real estate flipping to reduce your risk and shorten your learning competition… even while making nice money in the task? Well… clearly option #2 from above: The Wholesale Flip – or in other words… wholesaling real estate, flicking houses for quick cash, flipping contracts, etc.
When ever you wholesale real house you do everything a flipper would normally do… except actually repair the property and sell it to a retail buyer. However you don’t have the risk or time commitment that a fix and flipper has.
Essentially, you as a from suppliers real estate flipper (or wholesaler for short), find properties that need work that you can aquire at a sizable discount and flip them for a payment to a rehabber that will do the work.
Your job is to find the properties, analyze the figures to determine the vehicle repairs needed, create an offer that permits both you and the rehabber that you will sell to make a profit, and sell the contract to a rehabber who will can certainly make the repairs.
Typically times smaller property shareholders will make between $2, 000 and $20, 500 on the wholesale deal. As a result, for a low to no risk way to get started in real estate… there are huge profits to be acquired.