Properties up and down the country are in desperate need of some TLC, which could help them become wonderful homes for families, couples, or single homeowners. When done well, you could potentially generate tens of thousands of dollars selling one home, and some clever tactics could help you maximize your return on investment.
It doesn’t matter if you are a seasoned house flipper or about to kickstart your first project; you must regularly look for ways to generate a healthier ROI. Keep reading for advice on how to increase your house flipping profits.Use a Fix and Flip Loan to Fund a Project
Many experienced house flippers turn to fix and flip loan lenders to fund a new project. It is a great way to fund a house flip, especially if you don’t have thousands of dollars available for a downpayment and/or renovation costs.
Fix and flip loans will provide fast access to the money you need to buy a property and fund its renovation. Rather than cutting corners or skipping home improvements, you can complete many tasks to a higher standard and at a quicker pace, increasing your return on investment and reducing a property’s time on the market.
Add Square Feet to a Property
Boost a property’s value by adding square feet to one or more living areas. Review recently sold property listings to identify if prospective buyers are happy to pay more for a larger bedroom, kitchen, or bathroom.
Learning about neighborhood trends will ensure you increase square footage in the right places, which could increase a property’s value and make it more appealing once it is placed back on the market.
When browsing the market, look for properties with unfinished spaces you can renovate, such as an unloved garage, a spacious attic, or a neglected basement.
Pick a House in a Popular Location
Location matters when flipping houses. It is imperative to purchase a property in a popular neighborhood to receive a great ROI. Research recent house sales to identify if homes are selling quickly.
Remember, there will be a bigger demand for a property near a good school district, many stores, and entertainment venues. The more popular a neighborhood is, the more buyers might be willing to pay for an attractive property.
Execute Profitable Upgrades
The home upgrades you choose will determine your ROI, as they are not all created equal.
For example, the following upgrades are unlikely to increase a property’s value:
- A swimming pool
- Hot tub
- A garage conversion
- Excessive professional landscaping
- Luxury items (such as underfloor heating or steam showers)
Instead, you could increase a property’s value by renovating a kitchen and/or bathroom, improving its curb appeal, installing new, energy-efficient appliances, applying a fresh coat of neutral paint, or laying down high-quality hardwood flooring, to name a few options.
Look for a property with excellent potential during a showing. For example, you could add value by fixing a garage door, installing new windows, or adding a deck, as it will become a more appealing option to potential buyers.