Here are some of the critical essentials to make this gamble pay off.
Solid overview
1.You’ve got to have a solid overview of the business.
You just can’t go out and start making offers - even if you have some money. I guarantee you’ll lose your money if this is your approach.
Don’t think that fixing up houses is a piece of cake. You’ve got to know what you’re doing.
Good Contract
2.You’ve got to have a good contract.
Picking up a crinkled ole contract from your friendly real estate agent won’t cut it. Most contracts are NOT written to give you the slight edge.
Yes, I have taken home thousands and thousands of dollars from closings - up to $75,000 from my best closing on just a cheap little house - but the reward for using good contracts involves even more than walking out of a closing with a fistful of bills. You can get your seller to take care of some or all of your closing costs if you have a good contract. And you can avoid some of your usual part of the closing costs as a buyer if you have a good contract. But don’t try buying a cheap or expensive house without a good BUYER’S contract.
Good working model
3.You’ve gotta have a good working model as a pattern for your fix-up project.
If you have never tackled the job of remodeling or even fixing up a house, you don’t have any idea what needs to be done and what should NOT be done.
Let me tell you, you will be tempted to spend far more than necessary if you want the perfect house to sell. I know, because my wife is always suggesting what we need to do to our houses. Sometimes she is right, but often she wants to dress up a house with items that do not bring return on investment. It’s a very thin line of distinction.
Your analysis should establish a fix-up formula.
Let’s face it. You can spend a bank full of money in fixing up a cheap little house. And it’s easy to over-spend with money you will never get back. But, on the other hand, if you don’t spend the right money on the right things, no one will buy your house. The margin of difference is close.
The hat of a salesman
4.You have got to put on the hat of salesman when you get into this business.
Your remodeled house will not sell itself. You have to polish to a spit-shine, and make the finished appearance of your house come off as the most desirable house in the neighborhood.
Don’t fix up a cheap little house if you are unwilling to show it and sell it. You will lose a big chunk of your profit if you have to list it with a real estate agent.
But I’ve got to say, (and pardon me if you are a broker or agent), you don’t have to do much to outshine many real estate agents. There are some top agents and brokers across the country, and I’ve met and worked with lots of them. I have trained many of them. But so many found their way into the profession as an easy way to make a living. I have run across so many agents that promise the moon when listing, and perform so poorly at promotion. YOU can equal or better the job of most real estate agents in selling your own house.
But the key to your good job is in knowing what you are doing when you sell.
Treat it as a business
5.This is a business.
It’s not a hobby and it’s not a game. It is, however, a slam-dunk, dead-serious, rock-solid way of making money when you
learn the ropes. And it just may be the easiest way you have ever earned a living.
But you have to know what you’re doing.
You can make money if you decide to fix up cheap houses. But you must learn how to do it right.
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