It seems that every week I see some type of show on the TV that is about renovations / flipping properties for a profit. To be honest, it looks like a lot of fun and quite often the profits can be staggering, but is it worth the effort?
There seems to be so many things that you need to be an expert in, that I often wonder just how many people would actually be suited to doing the whole renovation thing? For me personally I’m just not all that handy, and so I would likely struggle to make any money, but I do know plenty of people that have given it a go and that have made some good money in the process.
Getting the Right Property
The number one tip all the experts tell you is that you need to select the right property to begin with. The aim of the game is to make money, not to find / make the home of your dreams. The first step of that process is to evaluate the type of property you are going to target and the amount of money you think you can make when you decide to resell the property.
Generally speaking the houses that I have seem make the biggest profit have been fixer upper homes that have big potential. Often these houses have been neglected by their previous owners, but are either in a great area, or have some great underlying charm that just needs a little TLC to bring them back to their former glory.
As I just mentioned, location is something that’s super important to consider. There isn’t a lot of point doing up a house in an area that just won’t give you a good return on investment. Consider things like:
- Property growth in the area
- Access to public transport
- Access to local school
- Try to avoid busy highways or busy main roads
Who are the type of people looking to buy in this area? Make sure that the house you are planning on buying can be targeted to the correct demographic to maximize on potential future profits.
Areas to Target when Renovating
OK, so you have decided on the property that you are renovating and now need to work out where to best spend your money to make the biggest profit when you sell the house.
Pretty much the number one place for any house to have looking right is the kitchen. If the kitchen is dingy, dark or just looks unappealing, then this is the first thing you need to get onto. Unfortunately kitchens are one of the most expensive areas of the house to fix, but when done right they can really help to turn a healthy profit.
Bathrooms are another area to think about spending money on. Not many people likes a bathroom that came straight out of the 60’s, 70’s or 80’s. If your house has one of these then it’s time to move it into the future.
Applying fresh paint to both the inside and the outside of the house is one of the easiest and most cost effective ways to improve the value and appeal of a house. It’s amazing the difference a coat of paint can make to a house in regards to freshening it up.
When it comes time to sell the property, be sure to hire a professional photographer to make the house really stand out in the photos. Also, using a local real estate agent will help you to better understand the local market and this will help you when it comes to presenting the house for sale.
Finally, make sure you know what price you need to sell at to make a profit. There is no point putting in heaps of new materials and labor only to lose money. Good luck and hopefully these few tips will help you to make a heap of money flipping houses.