Home flipping has become an increasingly popular way to make money on real estate in the past decade, but it isn’t always the profitable venture many people assume it to be. I recently bought a house that had been flipped by the previous owner. Here are five things I wish I knew before purchasing the home and advice to help you avoid the same mistakes I made while buying my first flipped property.
What are flipped homes?
If you’re not familiar with the term, flipped homes refer to properties that have been bought and then quickly renovated and sold for a profit. It’s become a popular way to make money in the real estate market, but it’s not without its risks.
Repairs are unavoidable in flipped homes
Before buying my home, I was unaware of the many repairs that are often necessary in flipped homes. Had I known this, I would have been prepared for the thousands of dollars in repairs that I’ve had to put into my home. If you’re considering buying a flipped home, be sure to factor in the cost of repairs into your budget.
Buy at your own risk
If you’re thinking about buying a flipped home, beware. I learned the hard way that these homes aren’t always the dream they seem to be. Here are things you should know before taking the plunge
- The buyers might not have done much work on the inside of the house – usually, all of their attention is focused on renovating the outside. That means the floors might need refinishing and walls painted from years of neglect.
- There’s no guarantee that your new home will be in good shape even after an overhaul – for every 10 houses purchased and renovated by professionals, there’s one that falls through without being completed or redone poorly by amateurs.
A contractor’s advice
As a contractor, I’ve seen firsthand how flipping a home can be both good and bad. If you’re thinking of buying a flipped home, here are five things to keep in mind:
- Make sure you know what was actually done to the home.
- Inspect the work yourself or hire someone to do it for you.
- Don’t assume that because something looks good, it is quality work.
Closing costs can be more than expected
I had no idea that there would be so many hidden costs when I bought my flipped home. From repairs that were needed to update the home to property taxes, I was quickly in over my head. If I had known what I was getting myself into, I would have saved up more money before buying the home. As it stands, I’m still trying to pay off the debt from my purchase and it’s been a stressful few years.
Timing is important
If you’re thinking about buying a flipped home, beware. I learned the hard way that these homes aren’t always the dream they seem to be. Here are five things you should know before taking the plunge.
1) The buyers might not have done much work on the inside of the house – usually all of their attention is focused on renovating the outside. That means the floors might need refinishing and walls painted from years of neglect.