Oct 20, 2021 / Homeowners
Your Complete Guide To Flipping A House
For many homeowners, the idea of managing even the most minor of renovations can seem daunting. For others, they’ve based their entire livelihoods on flipping homes and then selling them for a profit.
While you probably fit somewhere in between those two types of homeowners, you’re probably at least somewhat interested in flipping homes if you’re reading this article — and why wouldn’t you? There’s everything to feel good about when you take charge and commit to making improvements to your home, no matter if you plan on selling your home afterwards or not.
So, whether you’re ready to attempt a home flip for the first time or you just want to get a better gauge of everything required to fully flip a home, you can refer to this guide to help you reach your renovation dreams along the way. Happy flipping!
Step 1: Finding A Home
If you’re already a homeowner and you plan on flipping your current home, then there’s not much you need to worry about with this step. However, if you don’t already own a home or you plan on flipping a home that you don’t personally live in, then this first step is pretty important.
Not only will you need to tailor your home search to find a property with high flip potential, but you’ll also need to think about that home’s local real estate market. If you plan on flipping a home and selling it post-completion, then knowing what the health and conditions of that property’s local market are is pretty essential.
Your best bet here is to talk to a local real estate professional — even if you plan on buying a home in your own neighbourhood. They’ll not only be able to give you a full run-down of the current and projected real estate market stats for your chosen area, but they’ll be able to scour the market for homes ripe with flipping potential. And eventually, help you purchase that home at a price that makes sense for your entire project budget.
Are you ready to start searching for homes ahead of your upcoming flip? Browse through our current featured listings page or filter your search for more specific listings via our links below. If you see a property that catches your attention, reach out to us directly for more information.
Step 2: Securing Financing
Once you’ve targeted a certain neighbourhood and settled on a particular home you want to buy (or already own), it’s time to crunch some numbers. At this stage, we always recommend you seek the assistance and advice of a trained mortgage loan specialist, and preferably one experienced in working with home flipping clients.
In fact, it’s best at this stage to consult multiple different mortgage specialists so that you have multiple different mortgage loan options to choose from. If you need assistance finding a trustworthy mortgage lender — whether they’re associated with a public banking institution or part of a private group — your real estate representative should be able to help you here.
Even if you already own the home you want to flip, you can still take out a loan from a lender to help you finance your upcoming construction project. That’s why this step is one every home flipper should explore.
When you meet with your potential new mortgage lenders, be transparent about what your flipping plans are, what you estimate the total costs will be, and ask them how they can help make your flipping goals a reality.
If you’re interested in home flipping, you’ll love learning about the tried-and-true BRRRR method — a classic real estate reinvestment strategy. Read up on our blog post all about The BRRRR Investment Strategy here.
Step 3: Buy Your New Home
Just like Step 1, if you already own the home you want to flip, you might not find this stage particularly useful. That being said, it’s worth the read if you might want to make more of a career transition into professional home flipping.
Once you’ve secured your financing and know exactly which home or homes you want to target, this step is ultimately left up to your Realtor® to help you complete. As noted above, your Realtor® should work relentlessly to help you secure the home you want to flip for the best possible price under the best possible terms and conditions.
The more you’re able to reduce the amount of budget you allocate to actually purchasing a home, the more you’ll be able to spend during the construction phases.
At Karen Paul & Associates, we’ve helped countless home buyers in the Burlington and the surrounding area find homes that suit their highly specific needs — whether they’re homes to live or invest in, or homes they want to flip. Find out more about how we can do the same for you here:
Step 4: Blueprinting Your Plans
Now that you own the home you want to transform, it’s time to confirm your construction planning. If you’re planning on completing a substantial full-home flip, it’s in your best interest to not only meet with a seasoned and experienced domestic contractor, but also a reputable architect, too.
Even if at the outset of your home flipping project you have it in your mind that you want to handle most of the construction yourself, it’s always worth it to consult an experienced pro before getting started. Just like in Step 2, we advise you to meet and speak with multiple different architects, contractors, and construction groups before assembling your team and finalizing your blueprints.
After reviewing each construction and budget proposal from your potential build team, you’ll need to settle on one and move the project forward with full confidence. Remember, this is your home flip, so it’s your responsibility to lead your chosen team and ultimately make the tough decisions. The best thing you can do here is to surround yourself with a group of reliable, trustworthy, and intelligent professionals.
From there, all that’s left is to get your construction plans approved by your municipal governments, and then you’re all good to go — however, that could take longer than expected. Make sure to allocate at least a few weeks to have your construction plans approved by your municipality, and even longer if they’re rejected the first time around.
Can’t wait to get flipping, but not sure what to include in your new home designs? Use these creative home improvement ideas as inspiration during your pre-construction phase.
Step 5: Breaking Ground
Now that you’ve finally got all of your ducks in a row, it’s time to get started! Rule number one from here on out until you’ve completed renovations is time management. Time is money, and from the moment you break ground, the clock is ticking.
Even if you’re tackling most of your home flip on your own, you’ll be working against the clock to complete your renovations before your funding, your construction permit, and patience run out! And the pressure will be even greater if you’ve got an entire construction team working for you, as those professionals tend to be paid hourly.
Our tip at this step is to diligently manage a tight construction schedule. Make sure you regularly check in with your contractors, construction teams, and any other supplementary crews that are helping you out with your home flip throughout the duration of your project. Stay on top of their progress and hold them to deadlines and projected expenses. If not, you run the real risk of your timeline and budget extending much further than you’ll have ever anticipated, and that’s where home flips fail.
Once you own a fully finished home, it’s not always easy to part with it. If you’re not completely sure whether or not you want to sell your home after your flip, you could always rent it out. Find out what the best choice for you is by reading our post, Is It Better To Sell Or Rent Your House?
Step 6: Sell, Sell, Sell
Once you’ve completed renovations, the hard part is over and it’s time to revel in the results of your achievements. Your home is up to shape and you’re ready to list it on the market.
For many, this step is just the beginning of what can be a stressful and nerve-wracking real estate transaction, but for you, nothing will feel challenging after completing a full-on flip — especially when you have the right help by your side.
In fact, finding the right Realtor® to help you sell your home is probably the most important thing you can focus on at this stage. The right Realtor® will be able to immediately see the value in a fully-updated, newly renovated home that’s been brought up to modern living standards just so it can be sold at a profit. In all actuality, you’ve done your future Realtor® an enormous favour when it comes to preparing a home for sale as all that’s left for them to facilitate is staging, marketing, and selling your flipped home.
From here on out, patience is your best friend. Bide your time interviewing the right listing agent for you and your home, make sure you enter the market at the most opportune time, and most of all, don’t rush through this final stage just because you’re finally ready to be done with the project. You’ve worked hard to get to this point, so make sure these final few weeks get the attention they deserve and next thing you know, you’ll be rolling in the money you’ve made from a successful and lucrative flip.
When it comes to selling a home, having an experienced team of real estate professionals on your side of the negotiations table is key to your success. Learn all about How We Help Home Sellers here.
Interested in learning more? Send us a message here and we’ll be in touch with you soon after.
