Going Flipping Crazy? Consider these 10 Things First

Have you heard the latest great news about living in Pittsburgh? Our city’s one of the most profitable places to flip a house! So, if you’ve been toying with the idea of buying low-priced property and making some improvements to turn a profit when you sell, now may be the perfect time to do so!

You’ve probably seen home improvement shows that portray an investor who buys a less-than-move-in-ready shack and quickly flips it into a dream home that sells for a handsome profit. The ideal situation is seamless and the return on investment is incredible.

But, as you know, there isn’t much in real life that is as easy at is seems on TV; so, if you’re thinking about flipping a home in Pittsburgh, here are 10 things to do first:

Crunch the Numbers: Before you even begin to think about purchasing a low-priced home to remodel and sell for profit, figure out each and every financial part. Talk with lenders; talk with contractors; talk with suppliers; talk with real estate agents. Talk it out and crunch the numbers to make sure that flipping a home won’t negatively flip your financial situation.

Scour for the Perfect Location: When it comes to making a profit by flipping a home, location is important. Successful “flippers” try to find available homes in areas where home prices are low, but residential demand is high. Revitalized neighborhoods are often great places to look for a profitable home to flip.

Be Picky: Finding a promising neighborhood is only the first step toward finding the right home to turn a profit from. Just because a low-priced home seems to be in OK condition and also has some serious potential does not mean that any home inspections should be skipped! Flipping a home can be costly enough, so the last thing you’ll want to do is sink more money into repairs that you weren’t prepared for.

Find a Trustworthy Team: Speaking of repairs and renovations, when you’re flipping a house, having the right team on speed-dial is essential. If you don’t already have reliable contractors or other handy people at your service, a real estate agent may be able to connect you with some trustworthy help.

Investigate the Competition: Another thing that a real estate agent can help with during the home flipping process is evaluating competitive properties. If you’ve selected a property in an area that is being revitalized, it is likely that other similar properties have recently sold or are undergoing a process similar to yours. Complete a comparative market analysis to make sure you’re not pricing yourself out of the profit game! Remember, your goal is to buy a house at a low enough price point that you’re able to put it in great condition without going into financial ruin; but, you still want to be able to sell the home below current market prices!

Keep it Simple: Again, thanks to TV home improvement shows, some people fantasize about turning a dilapidated home into a top-of-the-line real estate masterpiece. In reality, big budget upgrades can equal big-time busts when it comes time to sell. Sometimes, making needed repairs, replacing windows and doors, freshening up flooring and changing paint colors can flip a drab property into a fab investment!

Know Your Potential Buyers: Having the nicest home at the lowest price point in an up-and-coming area does not guarantee you’ll reach all interested buyers. As with any home sale, you’ve got to think about who those potential buyers are. Try to find out what buyers are looking for in an area and create it! After all, your newly-flipped home is an empty palette for creativity!

Stage the Home: Obviously, you’ll pick a home to flip that you feel has a lot of potential. But, just because you may be able to create a picture-perfect image of the home in your mind does not mean that your buyers will be able to do the same. Help them envision the property by staging it before they walk through the front door.

Have Other Options: In your home-flipping dream, you have may have envisioned flipping a home to have the first buyer walk in, fall in love and be on their way to the closing table. Frankly, it just doesn’t always happen that way. So, have an alternative… or two. If selling your newly-flipped home doesn’t happen right away, think about renting it out to the right tenant. They may end up wanting to buy, too! You also could sell your newly-flipped home to a real estate investor.  

Take Advantage of Tax Deductions: Flipping a home can be considered a second job; heck, it can be considered a full-time job! So, if you’re in the business of flipping a home, you may be allowed to take some typical business deductions when tax season rolls around. Home repairs and maintenance may be deductible, as well as a portion of your cell phone bills and business use of your home and vehicle. To ensure you’re taking the correct deductions, consult your accountant or tax preparer.

Are you ready to go flipping crazy? Start your property search in Pittsburgh by contacting a trustworthy Berkshire Hathaway HomeServices The Preferred Realty real estate professional today!