Flipping Houses in a Wholesale Real Estate Market
While some people are lucky enough to see a house while driving around, flip it and make instant profit, most people have to do the dirty work for flipping houses, aka, the searching, data retrieval etc, to find the appropriate market.
Finding Your Market
When you’re looking for a good wholesale real estate market while flipping houses, look in your neighborhood first. You know what areas are good, what areas are bad. The home (or homes) is close enough to drive to, so that you can look it over yourself. Also, look at the homes you’re considering with an unbiased eye. Just because you wouldn’t buy them doesn’t mean someone else wouldn’t.
Data Retrieval
While you can build the data yourself when flipping houses, you can save a lot of time and resources by checking with local mortgage companies and insurers. If these companies say, “I wouldn’t insure this” or “I wouldn’t buy this” that’s a good indication that you may want to look elsewhere.
Does this mean you absolutely shouldn’t choose this wholesale real estate market? No. If your business is flipping houses, you should also make it your business to know what’s going on in the area. Maybe there’s a new mall about to open or other construction that will keep the market steady, raise it, etc. Check into the possibilities, then – and only then – decide whether flipping houses in your chosen wholesale real estate market is a good idea.
Flipping Houses
How does flipping houses work? Can the current market handle it? These questions and more may come to mind when you consider the possibility of flipping houses.
How does it work?
It’s easier to explain than do, but flipping houses works like this:
You find a market that is reasonably strong and fairly small, somewhere between 70,000 to 200,000 people. Look in that wholesale real estate market to find homes that are selling at lower rates – this is a good indication that the owner wants to get rid of it quickly. Using your investor’s money (or your own if you have the funds), you buy the house and then sell it to a preselected buyer. You’re the middleman between buyer and seller. You take a percentage and everyone is happy.
Can the market handle it?
One of the worries that might occur to you is flipping houses in the current real estate market, but the skies are clear ahead as long as you research carefully. “It’s really about what’s working now and in this market,” says Cris Chico, of VirtualWholesaling.com. “Despite what you hear on the news, despite what you hear from the media, there are still people making money in this [today's] market.”
You don’t have to be a real estate agent to get into flipping houses. For that matter, there’s no law that even says you have to have a real estate agent, whether you’re buying or selling. What you do have to have, however – what is most essential when flipping houses – is a good market and wise decision-making.