Arnold
CibbuanoFlip This House
October 13th 2006 00:58
For those that are interesting in property development as a means of making money I’ve discovered this little nugget of a tv show in the US called ‘Flip This House.’ It is much like the reality doco-soap style renovation shows that are shown in Australia except that there is far less emphasis on stupid tv presenters, boring gimmicks/theatrics and far more useful information for anyone who is interested in the house flipping market.
What is house flipping? It’s the latest craze in the real estate market that has started up in markets internationally. Everyday people with a little introduction to the property market and housing development are buying into properties and transforming derelict lots into superbly designed new homes, all within a matter of weeks. It all looks like a quick way to make a buck and I guess the TV presenters do a good job of selecting the successful contestants.
Of course there are bound to be some failures along the way, although they’re carefully shielded away from the eyes of viewers. Nevertheless, the show has really demonstrated that fixing up a house can be a really good way of turning around some fast cash. One couple managed to buy and resell a property with an $85,000 profit over the period of 2 months intense work. The initial payout for the property was $540,000. I think they did brilliantly considering they kept the renovation expenses down to sub $20,000.
Flipping houses is not for everyone. As one contestant said, it is pretty difficult to loose money in this game. But believe me, for someone who is ill-informed I can see the potential for disaster. Things such as not checking what needs to get certified by a building inspector, termites and other unforeseen little surprises can blow out budgets and extend the time for renovation.
The other big issue is capital and time investment. To flip a house in a short period of time, you are going to need a reliable team of contractors and to be available 24/7 as a project manager. For the weeks that you are renovating there will be no time for a full time or even part time job. Its all hands on deck making sure things run smoothly and saving on labour costs by doing as much work as possible yourself.
Capital is the other bug in the system. You’ve got to have enough to firstly finance the purchase of the property, sustain yourself for the weeks you wont be having an income and pay for all the renovation costs. Typically, the greater the initial investment, the greater the final return. But, you still want to keep a good budget and financial plan. There’s little point blowing all your savings on a huge property only to find that you don’t have any money to pay the contractors, materials or resale fees. In these circumstances you’ll be faced with running at a lose just to scramble together some finances.
All in all though, housing flipping looks like an unreal and rewarding experience. There’s the satisfaction of creating and remodeling something all on your own steam as well as a probable financial return. It’s some I definitely think I’ll give a go one day.
What is house flipping? It’s the latest craze in the real estate market that has started up in markets internationally. Everyday people with a little introduction to the property market and housing development are buying into properties and transforming derelict lots into superbly designed new homes, all within a matter of weeks. It all looks like a quick way to make a buck and I guess the TV presenters do a good job of selecting the successful contestants.
Of course there are bound to be some failures along the way, although they’re carefully shielded away from the eyes of viewers. Nevertheless, the show has really demonstrated that fixing up a house can be a really good way of turning around some fast cash. One couple managed to buy and resell a property with an $85,000 profit over the period of 2 months intense work. The initial payout for the property was $540,000. I think they did brilliantly considering they kept the renovation expenses down to sub $20,000.
Flipping houses is not for everyone. As one contestant said, it is pretty difficult to loose money in this game. But believe me, for someone who is ill-informed I can see the potential for disaster. Things such as not checking what needs to get certified by a building inspector, termites and other unforeseen little surprises can blow out budgets and extend the time for renovation.
The other big issue is capital and time investment. To flip a house in a short period of time, you are going to need a reliable team of contractors and to be available 24/7 as a project manager. For the weeks that you are renovating there will be no time for a full time or even part time job. Its all hands on deck making sure things run smoothly and saving on labour costs by doing as much work as possible yourself.
Capital is the other bug in the system. You’ve got to have enough to firstly finance the purchase of the property, sustain yourself for the weeks you wont be having an income and pay for all the renovation costs. Typically, the greater the initial investment, the greater the final return. But, you still want to keep a good budget and financial plan. There’s little point blowing all your savings on a huge property only to find that you don’t have any money to pay the contractors, materials or resale fees. In these circumstances you’ll be faced with running at a lose just to scramble together some finances.
All in all though, housing flipping looks like an unreal and rewarding experience. There’s the satisfaction of creating and remodeling something all on your own steam as well as a probable financial return. It’s some I definitely think I’ll give a go one day.
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