You’ve seen it—flipping a house looks so easy. You only have to buy an old house, repair and redesign some areas, put the property back on the market, and earn a huge profit. Dozens of reality TV shows have also made the process look fun, fast, and lucrative. But, in most cases, that’s a bit far from the truth.
Buying low and selling high isn’t that simple, especially when it comes to real estate. There are a lot of processes between those two points that can hurt your finances and even stress you out. If you want to try your hand at house-flipping, you can get a head start by avoiding common house-flipping mistakes.
Mistake #1: Thinking cheap is inexpensive
The easiest and cheapest properties to buy are those in the worst shape. But there’s a catch: those properties need the most work, requiring unbelievably high repair costs and taking a long time to finish.
Without a solid understanding of the many components of a house rehab, novice house-flippers often find it difficult to estimate the level and cost of renovation needed to improve those properties. They end up going over budget and spending more than what they initially plan, making the project unprofitable.
Remember, just because a property is priced low doesn’t mean you’re getting a bargain. Before taking on house-flipping projects, study the rehab processes, construction details, and other necessary elements. That way, you can assess any property thoroughly, including those that are in the worst shape.
Mistake #2: Biting off more than you can chew
Some people take on house-flipping because they have great DIY skills and a few carpentry skills. But the project comes with many risks that are often glossed over by those reality shows you see on TV. These risks—from roof leaks to structural damage—can surprise you and put your skillset to a great test.
While checking out a property to flip, consider the tasks you can work on and those you have to leave in the hands of professionals. Perhaps, you need to hire duct-cleaning services to ensure good indoor air quality. You might also have to call local plumbers for massive leaks in the kitchen and bathroom.
That way, you don’t bite off more than you can chew. You can then manage your time and budget well. Keep in mind that doing all the tasks on your own can extend the completion timeline and hurt your profit.
Mistake #3: Neglecting the curb appeal
Many novice house-flippers only on the interior and a few exterior elements. That’s a huge mistake as curb appeal can increase property value and attract more buyers. But overhauling an entire backyard isn’t cheap, especially if it’s been neglected for years. That’s another reason some flippers skip landscaping.
Here’s the good news: you don’t have to plant a forest and construct a water feature. Cleanup, repairs, a few outdoor furniture and décor, and a bit of gardening can help you impress buyers and sell higher.
If you plan to flip a house, be sure to understand what it takes to do it and the risks involved. Never underestimate the time or money needed to complete a project. Plus, don’t overestimate your skills. Always remember that making a huge profit by flipping a home isn’t as easy as it looks on TV.