With all the roar of the media and all these new great TV Show's like Flip this House, Trading Spaces, and Property Ladder people are open to the idea of taking a substantial risk with their finances by starting a flip project. This series is going to be dedicated to an actual flip project that is currently in the works in Green Bay, Wisconsin. The purpose of this series is to hopefully help you avoid some costly mistakes that I've had to learn from in the past.
Now let's get into some substance! If you are going to be the next big flipper in your area you need to set out a game plan and goals and rules to have a higher chance of success. I try to be as realistic with the goals/rules we set out when starting a flip project. The goals/rules I set out for Shannon Kane my business partner and Owner of AAA+ Construction and I, may seem simple but if overlooked can become costly mistakes.
1. Location, Location, Location this has been told so many times to me it should have been ingrained in my head from a baby! But even I in the past have made some small errors with location. (Buying on too busy of a street, even if it is in a good location you have a high probability of scaring away great family buyers or buyers who are sensitive to sound.) You need to be where school districts are favorable, and where houses that surround you are in a well kept manner. You also need to be in an area where the housing market is moving, have your Realtor pull market reports in an area before purchasing.
2. Patience is a virtue is the tried and true saying. This is something over the course of the last 3 years I've had to battle with myself. I used to have the mindset I want it and I want it now which is absolute recipe for disaster in this business. With the amount of risk that a flip entails make sure whatever you do don't rush into it. The true winners in this game are the ones that have the patience of a saint. They will find better deals than you and in turn sometimes taking a substantial lower risk.
3. The Why? This is the question you need to ask yourself and be honest about it. If your only answer is to make tons of money as fast as possible you may need to make sure that you are ready to handle what a flip project contains. Flipping Properties is about 3 main things in my eyes.
- Effectively Managing people
- Solving problems
- Doing good things for the community.
You are probably thinking Greg are you nuts what about the massive amounts of cash. I believe if that sincerely you try to do good things for people and treat people fairly the money will in turn come. Let's take it a step farther to put it into how I think. Which we all know may not be right at all times. Simple math time let's say we bought a house for $50,000 and stuck $15,000 into it. The comparable's and general market says the house is worth $99,000. Sure I very well may be able to sell it for that $99,000 but buy pricing it at the highest tier of the comparable properties, I'm not leaving much room for value for the buyer. Trust me with the internet and the tech savvy buyers they see value and have a better perception what a home's worth than what you think, and their only getting smarter. So I want this to be a win-win for both parties. So I would in essence price this home at $89,900 providing a more win-win situation which should mean fewer Days on market which means you can start the next project quickly, while also doing a great service for your community.
Stay Tuned for Series 2 What to look for in houses that could be a possible flip.
If you have topics that you'd like me to cover in future articles please feel free to email me at email@example.com or comment below.
Contact Greg Dallaire, Realtor®, Micoley and Company. Licensed Realtor® in Green Bay, Wisconsin at 920-217-2647 to list your property for sale or to purchase a property in Green Bay, Howard, Suamico, East De Pere, West De Pere, Bellevue, Hobart, Bellevue, Allouez, Wrightstown, Denmark and the rest of Brown County Wisconsin. I'm accepting referrals.
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