Regardless of the state of the housing market, property is invariably upheld as a strong investment. The aim is still to buy low and sell high, of course. Yet, people who buy a home to eventually sell will tend to get a sound return. Even if not for profit in a particularly slow market, money back on investment is usually expected.
Naturally, waiting for mortgage rates to lower is ideal. There is a way to reduce the initial investment to try to make for a larger return. This is the art of house flipping. It’s not an effortless path to profit, but it is a proven one if you put in the work.
So, let’s have a look at the house-flipping scene. It’s not as popular as regularly investing in property, but there are ways to maximise profit.
The surging and slipping of house flipping
Source: Pixabay
There are a whole host of shows on TV from the UK and US showing people going out, buying houses, doing them up, and selling them for a decent profit. Yet, even with this exposure, it’s relatively niche. In November 2020, it was reported that home flipping reached a peak not seen since 2008.
This amounted to one in 40 homes being sold within 12 months of their last sale. In 2007, this house-flipping trend amounted to 3.7 per cent of all homes sold. By 2022, that figure fell to 2.3 per cent. The first three quarters of 2023 also indicated further decline to below the 2.0 per cent mark. The desire and know-how to flip a house is understandably rare.
People generally buy one home, live in it for several years, and sell it if necessary. Having a home and buying a fixer-upper isn’t a common desire. Nor is living in a house in need of renovations. Yet, a 2022 report for property flipping indicated a profit range of £10,000 to £75,000 on nearly two-thirds of flips since 2020.
Streamlining house flipping to profits
Source: Unsplash
Coming into house flipping, caution is the best starting point to get to profits faster. You’re buying a property that you know is lacking, but you don’t want those fixes to take too long. The longer the flip takes, the more it costs. Of course, the final sale can be streamlined to limit that part of the process.
Anyone can turn to online estate agents in an instant to get quick sales. It’s shown that 75 per cent of properties are sold within 30 days. On top of this, there aren’t any surprise hidden fees and you can sell for free. Being faster than most top estate agents, money can be saved during the end game. To get started, it’s wise to take your time.
Explore foreclosure listings, local auctions, and wholesalers to find good deals. Then, hire a professional to inspect the house. If all’s clear, you might be in for a good flip. From there, you could capitalise on the investment further by doing a live-in flip. It can be a bit of a discomfort, but you won’t need to rush renovations, pay two mortgages, or pay income tax upon its sale.
If you’re handy and looking to invest in property, consider flipping to maximise that investment.
