Are you planning to try and flip a house in 2021? Buying, renovating and reselling property can be a fun and financially rewarding process. You’ll learn new skills along the way and increase your budget for next time – providing you can pull everything off, of course.
There’s no doubting that it’s a risky business. You’ll need enough spending power to buy a property and invest in necessary renovations upfront, so it’s worth researching your financial options. Read a quick guide to property flipping’s other practical considerations below.
How to choose the right property
Identifying the right property for flipping can be the trickiest part of all. There are a few key factors that should steer your decision.
First is the local area. An attractive location for buyers usually features good schools, amenities and transport links. Properties in these areas tend to sell quickly and can attract bidding wars.
Next is the property itself. While quirky options can catch the eye, try to think practically and choose one that will appeal to as many markets as possible – like a three-bedroom semi-detached house.
Last is the potential for improvement. A property that needs work doing will offer more opportunity to add value than one that has recently been refurbished. Those with easily fixed structural issues can be especially promising.
Where to find properties to flip
Now you know what you’re looking for, how do you go about finding those kinds of opportunities? You’ve got several routes to choose from.
Asking local estate agents about popular areas can set your sights on the right locations. From there, conduct research online and take a look around yourself to see if you can spot any properties that look empty or in need of work. The number of empty homes in England has increased in recent years.
Property auctions are another good option but are often competitive, so set yourself limits and avoid getting caught up in the heat of the moment.
Choosing the right renovations
While not always the case, most properties that are ripe for flipping require some level of refurbishment. This can be the fun part if you’re handy – but not all home improvements offer the same returns.
You can choose to hire a main contractor to manage sub-contractors for you or manage the project yourself and hire individual contractors. For your first time, it could be best to lean on the expertise of others.
Whatever refurbishments you choose to make, from interior decorations to structural alterations, it’s important to tailor the spec to your target market. You’ll also need to have a clear schedule, especially if you’re relying on external finance.
From here, all that’s left to do is attract buyers and seal the deal. Selling for the right price requires work, however, so there are a few final steps to think about.
You’ll need to stage your property in a way that allows buyers to imagine themselves living in it. When it comes to hosting viewings and making a sale, you can take this responsibility on yourself or appoint an estate agent to handle it for you.
You’ll also need to set a realistic price based on your initial research, how your project has turned out and the current state of the market.
Now you have a better idea of the process, could property flipping be a worthwhile venture for you?