- Find Suitable Homes
Forming a relationship with an expert real estate agent is an excellent way to keep apprised of when acceptable houses come up for sale. No one knows the area’s market better than they do.
If working alone, look for homes needing updates such as walls and flooring that can be easily replaced, wallpapered, or painted over. A good deep cleaning can do wonders for homes that have been neglected but have great bones. If you are unable to complete these tasks by yourself, you can hire subcontractors such as painters, flooring experts, and house cleaners who can take care of them for you.
Be wary of high-cost and time-consuming problems. Serious issues such as water damage and needing new pipes installed can be incredibly expensive and resource-intensive, so avoid homes that may require them.
- Get Funding
Though personal savings or private investors can be used to fund your house flipping enterprise, many in the business will need to acquire money from a more traditional lender. While you can apply for a conventional mortgage to pay for houses you’ll flip, there are other options for renovators that may be preferable such as rehab loans or bridge loans.
Ensure any loans you consider don’t include extraneous fees or services you don’t need. Kiavi and Lima One Capital could be two excellent routes for aspiring house flippers.
- Skip Individualized Improvements
Some home improvements are more cost-effective than others, and some can even lose you money in the long run. Installing a wine bar may seem like a good investment if you are personally interested in collecting, but it’s smarter to spend what money you have on renovations that are universally appealing.
It’s almost always worthwhile to improve the kitchen. This may be as simple as repainting the cabinets, or it could mean installing a new range hood (which can help keep the air inside your kitchen fresh and clean), stove, dishwasher, microwave, and refrigerator. The updates you undertake will depend on your budget and what the house needs to sell at a profit. But homebuyers expect an up-to-date kitchen.
- Form a Business
If you’re going to be house flipping consistently, it’s smart to form a business. Additionally, unless you will be doing all the work on your own, you’ll probably be hiring subcontractors to assist with projects, and it makes better business sense to hire workers as a business instead of you personally employing them. Being a registered business also gives you more credibility within the community and opens up opportunities such as being able to join your local chamber of commerce.
When choosing a business structure, limited liability companies offer the best protection for many situations, as these allow business owners to keep their assets separate from those of their business while offering pass-through taxation and paperwork perks. Consider your operating agreement when deciding what business formation is right for your situation. An operating agreement is required and establishes how you plan to run your business from funding to day-to-day operations.
Once your business is established, create a logo for any official business documents or advertisements. You don’t have to hire a designer if you don’t want to; you can make logos for free online. All you need to do is choose a template, then customize the colors, text, and graphics to your liking. Once complete, you can download your new logo for use.
If you don’t intend to do all the work on your property yourself, you’ll need to hire employees — and that means looking for solutions that help you handle small business payroll the easy way. With dedicated payroll software, you can track employee time, manage direct deposits, and withhold necessary taxes with ease. There’s even an app for mobile management. Software will help save you time and money by making payroll run faster and with fewer errors.
- Sell Your Flipped Home
When it comes time to sell, a solid relationship with a real estate agent is incredibly beneficial. They can help you determine what price you should be selling for, where and how to advertise, and even the best time to sell.
Ambitious senior entrepreneurs can get a pretty penny for their efforts. If you dream big, do your research, use qualified professionals and work hard to turn your vision into reality, you, too, can be among those prosperous individuals rolling in that house flipping dough.
