When you consider getting started in fix and flip investments you’ll want to keep the following things in mind.
1) Fix and Flip Investing Is Not Quick and Easy
First, fix and flip investing takes time, effort, money, and as some say, “blood, sweat, and tears.” It is not a get rich quick sort of business, although you can be successful at it if you approach things right and become very knowledgable about the process. However, don’t expect it to be quick or easy.
2) You Will Need a Reliable Team
Many people starting out in fix and flip investing don’t understand the need for a reliable team including a knowledgeable realtor, reliable contractors and workers, and quality supply companies. Not having these people and businesses in place can make the process much more difficult than it would be otherwise.
3) You, Will, Need the Right Knowledge
Fix and flip investors need the right knowledge to make cost-effective and wise decisions. Having the right team can greatly enhance this process, however, investors need to do their homework and learn the tricks of the trade. These include:
- The effect of location on a fix and flip
- Whether or not the return on investment (ROI) will be significant enough to make the investment worthwhile
- How real estate inventory affects the resale value and speed of close on a property
- How seasons and times of year affect saleability and resale value
- When is the best time to purchase
- How long will renovations actually take
- What obstacles might come up that need to be navigated and will increase the cost
- How to finance your property
Having the right knowledge will greatly enhance the success ratio for fix and flip investors.
4) Fix and Flip Investments Require Financing
Finally, it is vital to have the right financing in place for these types of investments. Getting started in fix and flip investing is expensive and may require large down payments and money for renovations as well as house payments until the property is flipped. In addition, investors need to be prepared for unexpected expenses and have backup financing plans in place. This is where knowledge about loans and financing options comes into play, as well as having a reliable financing source at your disposal.
Contact us at Nations Capital Financing to discuss your fix and flip financing needs.