As a property manager and a real estate investor in the Columbus market, I do a lot of flipping. Lots of people are interested in flipping houses, so I want to share some of my experiences.
Flipping is a Math Game
The first thing I would stress is that flipping is a math game. It’s all about the numbers. That’s one of the biggest challenges a lot of flippers have. They have grand notions about building a beautiful structure and making lots of money. But what they often don’t do is focus on the numbers. So remember that in order to be successful, you have to pay attention to the numbers.
Make Smart Purchases
You also need to make the purchase wisely. Buy a property that can be flipped profitably. Buy it cheap enough that you can take it after the rehab and the construction and sell it for a profitable amount after taxes. These are crucial things, which is why math is vital. If you find properties out there that are cheap and vacant, it’s probably for a reason. Most investors know it’s not profitable to flip them, so experienced flippers like me will pass them up and not buy.
Understand the Economics
You have to know how much it will cost to flip a property. That requires a lot of finesse. You need reliable people to tell you what your expenses will be before you ever put a shovel in the ground. You also need to know what the property will sell for before you buy it. To flip effectively, you’ll need a great agent who understands the market so you can sell for a profit.
These are complex issues within the topic of flipping properties. It can be a profitable venture, but I warn you to be careful with it. Plan well before you start your first flip.