5 House Flipping Tips for Impressive Profits
Personal loans can be great options for home renovation needs. This makes it a practical tool for house flippers.
House flipping is a business where an old or forlorn property is bought at a low rate and then renovated to sell it off at a higher price. With the best terms in home improvement loans, flippers can work towards a successful business. Apart from funding needs, the success of a house flipping business depends on many factors. Let’s look at some tips that can aid in good decision making.
Tip#1 Decide Your Budget
How much can you spend to be able to sell a house at profit? Your budget will depend on several aspects like:
- Repair costs
- Down payment
- Home loan EMIs (if you have availed one)
- New structural developments
- Labour costs
- Legal fees
- Cash at hand
It might take some time to sell your house, so you don’t want to stretch yourself too thin. Follow the 70% rule. This means you cannot spend more than 70% of a home’s after repair value. Based on your needs and financing, you can apply for an instant personal loan.
Tip#2 Analyse the Local Area
When you hunt for good properties to flip, look into the neighbourhood. Consider properties that people will want to purchase. For example, the presence of good schools nearby, a safe locality, easy transportation options through buses and metro lines, are some things to consider. All of this can enhance your property value.
Tip#3 Get the Property Checked by a Contractor
Ask a contractor to check out your property, and give your expert advice on what repairs and additions are needed. Have them provide an estimate of all costs and the timeline of the projects. You will need to consider these costs when you apply for a personal loan. Make sure to hire an experienced contractor who has a reputation for finishing projects on time and high-quality work.
Tip #4 Check out the Latest Trends
Apart from analysing the local market, you also need to understand the buyers’ needs. Check out the latest trends in kitchen and bathroom designs. Look for amenities that the current buyer seeks. You have to make your after-renovation property highly marketable. Choose only those repairs and renovations which will deliver higher ROI (Return on Investment).
Tip#5 Work towards Obtaining Permits
If you require permits for any repair or re-construction, get down to it immediately. Permit approvals can cause a lot of delay in renovations. This is why an experienced contractor is important for house flippers.
Lastly, take care of your financing needs beforehand with a personal loan. These are unsecured loans, which don’t require collateral or extensive documentation. You can take care of your down payments, repair costs or any urgent costs. Say, for instance, unforeseen costs like stamp duties or higher than expected registration costs can lead to delays in the project.
Your personal loan amount should be able to cover these needs. At the same time, you also need to have the repayment capacity to avail them. Take decisions after careful research. This takes time, so start at the earliest.