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The Smart Way To Flip That House

Buy low and sell high is the quoted phrase of investors all around the world whether referring to the stock market or the real estate market. While this is one of the best ways to insure a profit, how can you determine the property you just purchased will sell for the price you think it should?

Here are some tips on how to flip that house quickly.

First impressions often need to be the best. They are those proverbial nuances that can make or break a lasting relatonship.It's the same with real estate. You may have a fantastic property with lots of expensive amenities on the inside.

Solid oak floors, cathedral ceilings, balconies and lofts, large kitchen with tons of built-in cabinets but no curb appeal.

Curb appeal? Yes, curb appeal. The house may be beautiful on the inside but look like an ordinary or even run down property on the outside. This is a major set back when it comes to flipping that house that you've spent so much time and effort in finding and fixing up.

The first thing that interested buyers typically notice is how the house looks from the outside. After all, that is what they see first when potential buyers arrive. A prospective buyer typically wants a nice big yard with room for the 2.5 kids and their family dog. If the yard is cluttered with debris or lots of small trees and shrubs, there is no room for their family and they will likely drive right by without so much as stopping.

Many new investors make the mistake of fixing up the interior to the point of financial fiasco. Just because you think those new cherry cabinets in the kitchen will sell the ladies, does not mean it is worth the extra $10,000 you put into it to make it look that particlar way. Always leave those things alone that do not need fixed and focus on repairing or replacing what is appealing to the highest number of homebuyers.

Here is an example. Let's say that you find a house on the market the family had to sell due to the death of a loved one. The property has likely not been updated since the late '60's or early '70's. Looking at the yard, you notice that it's nice but really overgrown with months and years worth of weeds. You're able to pick up the property for 65% of market value because the relatives want a quick sale and are all out of town. Appraised value is $100,000.

The first thing an investor should do is clean up the yard. Make it look like the best yard on the block but don't go overboard. Try using plants and shrubs already in the landscape to generate the appeal. Dig them up and move them if you have to, but make the yard look as appealing as possible to the average homebuyer.

Repair any severely cracked sidewalks. You may have to pour new ones, but you may just be able to repair the existing and still make it look good. Do not tear up the walkways to add, say, herringbone patterned brick unless you know it will definitely add to the value of the home.

As you make the yard and front of the house more presentable, people will definitely notice. These few simple improvements will start generating interest in a hurry. You want this to happen as soon as possible, even if you have only begun to remodel or repair the interior of the house.

The exterior of the property is next. Does it need pressure washed to remove years of grime? Are there small cracks in any of the brick work, if it's a brick home? Check to make all shutters and screens are in place.

If you are missing a shutter and can not replace it, remove the remaining ones to match. You're going for a uniform look and don't want to spend a lot of time and money doing so.

Once you are satisfied with the outside, move inside and begin the face lift process.

The entry way is everything.Place yourself on the other side of the entry way. What is the first thing you will notice when you walk in? Do you want that to be the focal point? If not, change it.

You might notice the chandelier in the dining room, but you want buyers to notice the fireplace in the living room. You'll want to take down the chandelier, unless it has added value to the property.

Paint can also do wonders. Stick to the neutral colors. Soft, warm are the best when appealing to families because women generally make their buying decisions based on emotional feel of a house.

If the new buyer does not like it and wants to go more contemporary, they will. You want the potential buyer to notice the house, not specific colors. You'll want them to be able to envision their own furniture in the room from the moment they walk through the door.

They'll likely be turned off if the colors are wrong. Off white and beige tones typically go with any decor. This is the color of choice for many investors as they prepare to flip that house. The same rule applies to the floors.

There may be hard wood floors which are simply breathtaking. Do not cover them up with rugs and carpet. Allow the natural character of the wood to show through. This includes the baseboard, crown molding and trim as well.

People like natural. If a buyer wants to paint the trim, they will. Right now, let the wood's natural beauty shine through.

When the walls have a fresh coat of paint and the carpets and floors are cleaned or replaced, the house is then marketable.

Sell the house as soon as possible so you can move on to your next project as soon as possible. You have most likely generated interest just because of the exterior changes you made.

If you were to have an open house, there would already be a list of potential buyers ready to walk in and compete with each other, creating a buying frenzy.

Fixing up a house in this manner may cost only $5,000 -$10,000 or so. These improvements still put the house at 30% below market value. More profit to you as the investor is the bottom line. That is how money is made quickly when you flip that house the right way.

Article Source: http://www.dummiesguideto.com

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