Do you love real estate? Have you always wanted to learn about how to turn a profit flipping property in IL? We’ve put together some great tips to help get you on your way to making excellent profits by buying and selling properties in IL.
The idea of flipping houses has grown over the past few years, partly due to reality TV shows and partly because more and more people have fallen in love with the idea of getting their hands dirty, doing the work and (if all goes well) turning a great profit.
Before you dive in head first, you should make sure you understand exactly what you are getting into.
Know Your Market
Real estate markets vary considerably throughout the United States and the unique characteristics of each market will tell you what the best investment strategy will be. You’ll want to consider details such as average selling price, average days on market, average rental price, and many details when deciding if flipping properties is the right investment strategy for your area.
Know Your Numbers
Let’s start with the most important number you need to know which is your after-repair value (aka the price you will sell the property for after it has been fully rehabbed). Getting this number right is absolutely critical in successfully profiting from flipping the property because you will work backwards from this number to determine your offer price.
You’ll need to deduct your selling costs (commissions, closing costs, etc), rehab costs (construction materials and labor), fixed costs (utilities, debt service, taxes, etc.), purchase costs (closing costs, attorney fee, etc), and desired profit from the after-repair value to determine your purchase price.
Know Who Your Buyers Are
What is the demographics in the neighborhood? Are there families, retirees, outdoor lovers or students in the area? What will they be looking for in a home?
You will want to buy a home that that has features your leading demographic is looking for.
If you have young families buying in the area, focus on creating an open family room or finish the basement. If you have retirees, make the house easily accessible and the yard low-maintenance.
Price To Sell
Be realistic about what you can sell the home for. When you are calculating your ARV, don’t inflate the price to what you hope to get. When flipping a home, you want to sell it QUICKLY!
After doing your homework, you should know what homes are selling for in the neighborhood. Make sure you are listing your home at or slightly below these amounts.
Are you ready to turn a profit flipping property in IL?
If so, it is important to spend time thoroughly educating yourself and making sure you are aware of all market factors that will be involved.
If you are new to flipping and real estate investing make sure you work with a professional who can guide you through the process so you don’t end up losing a lot of money!