Flipping a house requires a strategic approach to transforming a property into a profitable investment. By following these steps and staying informed about market conditions, aspiring flippers can increase their chances of success in the house flipping business.
Step 1: Conduct Market Research
The first step is to understand the local real estate market.
Research trends, property values, and neighborhood dynamics to identify areas with high potential for appreciation. Look for neighborhoods that are on the rise or are experiencing revitalization, as these areas often attract buyers looking for move-in-ready homes.
Step 2: Create a Business Plan
A solid business plan is essential for guiding your house flipping venture. Outline your investment goals, budget, expected timeline, and strategies for financing and marketing. Your business plan will serve as a roadmap, helping you stay organized and focused throughout the process.
Step 3: Find a House to Flip
Once you have a plan in place, start searching for properties to flip. Look for undervalued homes or those in need of repairs. Use resources like Zillow, Redfin, and local real estate listings to identify potential flips.
Networking with real estate agents and attending auctions can also help you uncover hidden opportunities. The best opportunities are off-market properties, but you’ll need to either network or utilize a marketing system to reach sellers who prefer not to list their properties on the market.
Step 4: Get Financing or Secure Funds
Securing financing is an important step in the house flipping process. Explore different options, including personal savings, bank loans, hard money lenders, or private investors. Having your financing in place before making an offer on a property will strengthen your position and expedite the buying process.
One of the major advantages of belonging to a franchise system like New Again Houses is the access to capital from Alta Capital Management, which is not available to retail investors. The more preferable loan terms, the more projects an investor can manage at one time—which is important because it’s very difficult to create competitive advantages when only flipping one house at a time. Professional flippers create competitive advantages with volume and special access to capital that allows for that volume.
Step 5: Fix or Renovate the House
After purchasing the property, it’s time to undertake renovations.
The core business of flipping houses is adding value to the house with construction. Therefore, recruiting the right contractors and setting them up to succeed is one of the most important functions of a house flipper.
Prioritize updates that will yield the highest return on investment, such as kitchen and bathroom remodels, flooring upgrades, and curb appeal enhancements. Create a detailed renovation plan, rework your budget, and consider hiring skilled contractors to ensure quality work.
Staying on schedule and within budget is key to maximizing profits.
It’s not necessary to have construction skills—but it’s essential to have systems and processes in place to help ensure the success of contractors. Fortunately, New Again Houses Franchising surrounds franchise owners with construction support and expertise that allows them to succeed at scale.
Step 6: Stage the Finished Home
When renovations are complete, it’s time to stage the finished house.
While house flippers usually have the ability to envision what a space can be, most buyers don’t share this gift for vision. Buying a house is an emotional experience, and an empty house doesn’t bring the same emotional experience. Staging the home can make a significant difference in attracting buyers.
Consider hiring a professional stager or using your own furnishings to create an inviting atmosphere. Your goal should be to highlight the property’s best features and create a space that allows potential buyers to envision themselves living there.
Step 7: Market & Sell the Property
With the home staged and ready, it’s time to market and sell. List the property with a high-quality agent, who will market professionally. An agent will have a professional photographer take high-quality photos and write compelling descriptions to showcase the home’s renovations. Open houses and virtual tours can also help generate interest.
Be prepared to negotiate with buyers to achieve a profitable sale.
Step 8: Close the Sale
Once you receive an acceptable offer, work with a real estate attorney or agent to finalize the sale. Ensure all paperwork is in order and comply with local regulations. After closing, review your financials to assess the overall profitability of the flip.