Over the past years you and I have actually been pound on TV with real estate flipping programs that portray these people making outrageous earnings turning homes and making it look much easier than heck.
So, is this flipping things real? Well it sure is. There are countless people out there making a darn excellent living flipping homes. But the television reveals on flipping are darn deceiving when it pertains to the "reality" of property flipping.
Is real estate flipping the best way to obtain starting in property investing? I'll let you decide on your own. However, in my opinion, for many people, specifically in today's down markets (not all markets are down there are really some doing really well), real estate flipping is not the best way to get started in real estate investing.
First, let's clarify 2 sort of flipping.
The Fix and Flip - Where you buy real estate, rehab it, and sell it to a retail buyer. The kind that is on the TELEVISION programs.
The Wholesale Flip - Where you buy realty (or get it under contract), discover a wholesale buyer, and turn the agreement. The kind that is less wonderful however has a ton of cash in it with a heck of a lot less risk.
To me, the Fix and Flip technique is not for the majority of beginner's although that is the kind of property investing you see on TELEVISION all of the time.
- You require a good understanding of rehab costs
- You need to have great financing either from a personal loan provider or a bank (private lender is preferable).
- You need to be able to drift the bring expenses if you cannot offer the property quickly.
- If you do not calculate your expenses perfect there might not be a great deal of room for error and space for mistake means greater threat on you!
- The market is in a downturn so there are less retail buyers out there for middle income homes which is exactly what many people start turning.
- There are lots of people out there making a very good living flipping but the majority of them started several years ago and have many flips under their belts.
- They currently have systems down, have marketing channels for getting purchasers, have solid financing sources, and so on. Not to say that new real estate investors can not do all of the above but you can.