Getting started with property flipping in urban areas
Posted on: 27 March 2018
You may have heard of all the lucrative profits and buzz around flipping properties. Flipping refers to the process of buying, renovating, and then selling a property at a higher price in order to make profit. If you're a real estate investor in an urban area, you may think of property flipping as a quick and easy process. Besides, the population in urban areas of Australia is constantly on the rise and the demand for residential properties continues to increase.
However, many conveyancing solicitors will tell you that flipping requires a detailed and strategic approach. This piece will give you helpful tips that you can use to get started on the property flipping path.
1. Don't bite off more than you can chew
The promise of lucrative profits may motivate investors to immediately attempt to flip large and expensive properties. However, there are many small details that surround the flipping process, and you need to learn these nuances by first dealing with smaller and simpler properties.
Starting small allows you to take on less risk as you become more experienced in dealing with multiple properties and understanding the local market.
2. Consider the location
When it comes to flipping, location is everything. Because your goal is to buy and sell in a relatively short period of time, it's important to identify a property that is located in an enticing suburb or other part of town. Most residents of urban areas are concerned about how close their kids will go to school, how far they need to walk to the nearest bus stop, or how long they will take for a round trip to the grocery store.
If you can identify properties that fulfil these basic needs, you will be able to sell fast and at a lucrative profit.
3. Remember the secret is in the purchasing price
In order for a flip to work, you need to purchase at a much lower price than what you will ultimately sell for. This can be tricky to do in urban areas where the demand for properties tends to drive up the price.
To get lucrative deals, you need to understand the local market well and know which periods are best for making a purchase. Each local market is different, so it's your insights that will enable you to identify competitive prices of properties.
4. Carry out proper renovations
Renovating a property before flipping will add the appeal value that you need from buyers in order to make a good profit. Make sure you have a professional carry out the necessary renovations, and target areas of the home that buyers in your market will value.
Lastly, make sure that you work with a conveyancing solicitor to facilitate your property transactions.
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