Home Flipping Guide

How to Locate a Flip

Nowadays, the buzz in the real estate industry is house flipping. It has become a popular practice among real estate investors. House flipping is simply buying a house cheaply, fixing or renovating it to add value and reselling it in the shortest time possible for a handsome profit. So, how does a prospective investor find a house to flip?

Generally when in search for a house to flip, a flipper (investor) looks for a house that can be bought for much less than it will be later sold for. It may be a run-down house, a foreclosed home or a house being sold in an estate sale. But every search for the right flip begins with a search for the right neighborhood. After all, location is what matters most.

The right area is one that exhibits steady or rising real estate values, has received various offers on sold homes or homes currently up for sale, has seen an increase of homeowners moving in from other areas, and has experienced a decline in the number of houses for rent. An area that has houses that generally require fixing or renovations and houses occupied by aging homeowners are conducive for house flipping.

Armed with this basic essential, you are now ready to find a flip. You can find a flip by farming, spreading the word that you are on the lookout for a flip, checking out advertisements and lastly doing research.

Farming

You can narrow down your search by focusing on a specific geographical area which real estate insiders term as a farm area. This area can be your own neighborhood, your ZIP code, you town or city or whatever else you want to set as your boundary. A good recommendation is to start within 10 to 15 mile radius of your home. That way you will not spend more time driving than actually looking at homes or talking to prospective sellers.

Familiarize yourself with your farm area. This can be accomplished by driving around each neighborhood in your farm area. While driving within your farm area, be on the lookout for “For Sale” signs, vacant houses and even occupied houses that are in need of repair. Jot down the addresses, contact numbers (if available) and other notes pertinent to the properties. You can then call (for sale homes) for other information to establish the approximate market values of houses in the neighborhood. You can also check tax records. Some tax collection offices give the owner’s name and address.

Spread the Word

You can expand your farm area and at the same time save up on your valuable time by telling everyone you come in contact with that you are looking for cheap or run-down houses to buy. Tell all your friends, relatives, business contacts, co-workers and everyone and anyone who can lead you to a bargain. Do not forget to hand out your business card to these people so that they will have a way of contacting you when they find a house. You can even leave flyers in places frequented by people such as churches, stores, schools, etc.

Advertisements

There are many sources of “flippable” properties. Every newspaper has a real estate section. Zero in on ads that say Handyman Special, Selling As is, Fixer Upper, Estate Sale, Must Sell ASAP or any ad that indicates the house needs repairs or the seller is motivated. You can also run your own ad in the “Real Estate Wanted” section of the newspaper.

Research

Research and further research can help you determine if you have found a house worthy, which means profitable, of flipping. A motivated seller sometimes sells because of certain “events” which may include out-of-town job transfers, unemployment, financial difficulties, illness, death, health problems or divorce. Research on what the state laws are concerning these unforeseen “events” so you will know how much time you have to act on the property. Information about these properties is usually available at the country courthouse, tax office and city or municipal office.

Finding a house to flip is no simple or easy task but there are plenty of “flippable” houses out there and once you find one, it is vital that you get it at the best bargain price possible.