Flipping houses or wholesaling is a creative real estate technique that has made several investors make astounding fortunes without actually investing much money of their own. Flipping property involves finding a property that is in need of repairs or that is in danger of foreclosure. The investor then signs a sales contract with the property owner negotiating a rate that is lower than the market value on account of its dilapidated condition or perhaps foreclosure which ever applies. The next step in a flipping houses deal will be to find an investor ready to rehab the property or buy the property at a slightly higher rate than what you negotiated with the seller and as you had included the "and/or assign" after your name in the contract, you can easily assign the deal to the investor. This way without investing much the flipper tends to make a cool profit in a flipping property deal!

An overview of Flipping Houses

The investor interested in flipping houses needs a consistent supply of motivated sellers as well as investors and rehabbers in order to negotiate deals with both parties. Thus he needs to advertise for both services so that he can have a consistent supply of both parties. He could keep running ads in the local newspaper such as "interested in buying houses in any condition, call number xx" etc. This way you could get a list of potential properties and motivated sellers. You could also place a simultaneous ads advertising property for sale or rehab getting a list of interested investors or rehabbers.

Let us say X finds a property valued at $400,000 after repairs and since it is in need of repair X negotiates a deal with the owner Y. X agrees to pay Y a sum of $ 340,000 and binds the deal with a minimal deposit of say $50 and a sales contract form the Board of realtors with the can assign clause in place. X finds a rehabber C who agrees to buy the property for $ 360,000. Thus X the flipper makes a profit of $20,000, Y has been able to sell property in need of repair and C gets to repair the property and sell it at may be a profit of $20,000 or $30,000 too. Thus an investor can earn anywhere between $5000 and $20,000 per deal flipping houses!

Flipping property such as multi-tenant apartments is also possible with greater margins of profit. It will help if you have good contacts with private money lenders as you can help investors interested in dealing with you find quick finances to go through with the deal. It will be a tough situation to have a great deal and have investors interested in the deal but with no cash in hand to seal the deal. This way you could earn a commission from the private moneylender too.

While formulating a contract for flipping a house or flipping property other than a house make sure you have included a clause to protect you in the event you do not find investors. 

Publicity Is The Key 

For better returns from filliping property deals you need to advertise and market your services as much as you can, look at court house records to find out what properties face foreclosure and attend the foreclosure auctions, find physically dilapidated houses and ask the owners if they are interested in selling or if the house is vacant ask the neighbor if they can give you the owners contact information as you are interested in buying the house, hire birddogs to help find appropriate property for you, have business cards ready and give it to people telling them that you are willing to pay a fee for anyone who finds an appropriate property and a deal is closed. Check out the areas in your city that have older houses and scout around. Leave your fliers saying perhaps that you are interested in dealing with old properties that are in need of repairs. Talk to the local couriers etc. and tell them you will pay them a fee if a property they inform you about are closed in a deal by you.

Attending foreclosure auctions can be a great way of meeting potential investors who you can deal with so be sure to hand out your business cards and introduce yourself to the buyers as a person interested in flipping houses deals.

Thus with creative real estate investing such as flipping houses or flipping properties other than houses, a person can make a comfortable living without the worries associated with owning personal property! You need little overhead to begin your investing career flipping property and once you have a consistent source of motivated sellers as well as investors or rehabbers you will be very busy with a monthly income averaging $10,000!

 

Do you own real estate articles or stories and want to share with other investors? 
You have chance to win $100 Amazon Gift Certificates. We will give away 3 prizes for top authors each month!

Email your articles or stories to:  articles@buyincomeproperties.com

 

© Copyright 2001 - 2010 by BuyIncomeProperties.com               

 

 

Visit Real Estate Forums for every real estate investing topics!  Enter Here

    

Top of Page