The real estate market has been around since the dawn of time with dinosaurs fighting over a piece of turf and it will likely be around long after we are gone in some form or fashion. Folks have been trying to make a buck off of real estate investing for a long time, so with more luck than others. One of the most fool proof ways to make a quick buck even in a bad economy is find a problem home that no one else wants, fix it up and sell it. It does not get an more simple than this.
It does take some special skills and some know how but with some experience and some common sense virtually anyone can make money this way. It is certainly not a get rich scheme or an effective way to pay off the bookie tomorrow but with some planning and hard work you can do pretty well.
The first step in the process is finding the right place to buy. This is also the most challenging step and the one that prevents most people from ever flipping a house. Don’t let the TV shows fool you, there are lots of homes out there that are good deals and available for purchase. And there are still not that many motivated flippers because it is hard work. Sure there is competition, but you just have to find your niche. Maybe it is small towns with older homes that may be poised to move up in value in the next couple of years. Let the pros or the fools fight over the higher priced stuff in larger urban areas.
Drive around, contact real estate agents in the area, walk the dog through the neighborhood, get a good feel for a place, talk to the locals, become a local. Look, look, look, and only when you find a good deal move on it. Make a low ball offer, what is the worst that can happen, they will say no? Most owners of problem properties are looking to get out and may be holding out for a fools offer but having not received one will take whatever is offered. If not move along to the next prospect. Realize that once you buy the place you are committed, so choose wisely.
Now that you have the place you have some decisions to make. Do you move in and live there while you are fixing it up or do you fix it up and sell it as quickly as possible? Each option is a great idea but comes with its own bucket of worms. See the next posts to get good ideas for each option.