6 Secrets That TV Shows Don’t Tell You About Flipping Houses
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House flipping is seen by many as a ticket to the American Dream – financial success and upward mobility.
The idea of buying a fixer-upper, renovating it, and reselling it for a profit is alluring. If you’re willing to hustle, it’s a way to make big bucks in a short period of time, all without having to be a landlord.
Plus, flipping houses allows people to use their creativity and imagination to transform properties, which can be fulfilling and satisfying. The positive portrayal of flipping in popular culture, such as reality TV shows, only adds to the allure of house flipping as a desirable and achievable goal.
Those real estate flipping TV shows may be entertaining to watch…
…but they can also be problematic in many ways. They often sugarcoat the reality of flipping properties.
The truth is, flipping is a risky and complex process that requires a lot of money, time, and expertise.
These shows also tend to ignore hidden costs, such as materials, labor, permits, and holding costs, which can eat into profits. And let’s not forget the ethical issues, like displacement of renters, exploitation of vulnerable homeowners, and gentrification, that these shows often brush under the rug.
Flipping TV shows may not show the full picture of the flipping process. Some things that these shows might not reveal include:
The true costs involved in flipping a property
Flipping shows make flipping properties seem like a breeze, but they don’t show you the real costs. Hidden expenses like materials, labor, permits, and holding costs can eat into profits and these shows rarely mention them.
They also fail to show the time and effort it takes to flip a property, which can take months or even years. Not to mention, unexpected issues and delays, like mold, structural problems, and zoning issues can add extra costs and time to the flip.
All of these hidden costs are crucial to consider before diving into flipping properties.
Make sure to do your diligence on a property if you’re considering it for such a flip.
The time it takes to complete a flip
Flipping shows make it seem like flipping a property is a snap, but in reality, it can take months, even years to complete a flip. From finding the right property, getting financing, obtaining permits, and completing the renovation, it’s a long and involved process. And that’s not even counting any unexpected issues or delays that can happen along the way.
It takes serious patience.
Shows edit out the time it takes to flip a property, giving you a false sense of how easy and fast it is. Don’t fall for the illusion: Flipping takes time and patience.
The potential for unforeseen issues or delays
This is the big one.
On TV, it seems like everything goes according to plan, but in reality, there can be unexpected problems during a renovation.
These shows rarely mention the potential for problems such as structural issues, such as foundation cracks or rotting wood, that can be costly and time-consuming to fix.
Flipping shows often make it seem like structural issues are a breeze to fix, but the reality is, they can cost a fortune. From foundation cracks, rotting wood, termite damage to sagging floors, these issues can cost thousands of dollars.
And that’s just the tip of the iceberg: Depending on the location, size and materials used, the cost can vary greatly.
For example, repairs to a foundation can cost anywhere from several thousand dollars to tens of thousands of dollars. Repairing rotting wood can also be costly, as it may require replacing entire sections of the framing. Additionally, termite damage can be extensive and costly to repair. Sagging floors can also be expensive, as it may require jacking up the house and replacing the foundation, which can cost tens of thousands of dollars.
Environmental issues such as mold or asbestos can also be a huge issue with old houses, which also requires specialized and costly treatment.
Keep in mind that these are unexpected expenses that can eat into your profit margin.
But also remember, this will be someone’s home someday.
As Grandma used to say, don’t let your eyes get bigger than your stomach. Think about the safety of future homeowner and occupants: There are no short cuts when it comes to following code and doing it right.
Additionally, shows often don’t address the potential for zoning issues or permit problems that can hold up the renovation process, or even make it impossible to complete the flip.
Flipping shows rarely discuss the market conditions for a flip, along with general economic conditions for the region where a flip is taking place.
Factors such as interest rates, housing prices, and demand for rental properties can greatly affect the profitability of a flip. In a hot market, flipping a property can be more profitable, as houses are in high demand and prices are rising.
In a slow market, however, it can be brutally difficult to flip a property at a profit.
Additionally, market conditions can also change rapidly, and what may have been a good investment at one point in time may not be a good investment at another point in time.
Market conditions and timing of the sale play a big role in a flip’s success.
Before taking the plunge, consider the market conditions and make an informed decision.
The ethical issues surrounding the flipping process.
This is a big can of worms, but let’s open it.
Flipping shows make it seem like flipping properties is all about making a profit, but they don’t show you the ethical issues that come with it.
From displacing renters, to exploiting vulnerable homeowners, to gentrification, flipping properties can have a negative impact on communities and individuals. Displacement of renters can lead to families and individuals losing their homes, exploitation of vulnerable homeowners can lead to them being taken advantage of and gentrification can lead to the displacement of low-income residents and loss of cultural and historical significance of the area.
Flipping shows often highlight the financial gain and the renovation process, but they neglect to mention the ways that flipping culture might be potentially unhealthy for the housing market in your local community.
When considering flipping a property, remember to approach it with integrity, fairness and empathy for those affected.
Flipping houses can be a profitable venture, but it’s not as easy as it may appear on TV.
Here are some secrets to success in flipping houses:
1. Do your research: Before you start looking for properties to flip, make sure you have a solid understanding of the local real estate market and the types of properties that are in demand. This will help you identify properties that have the potential to be flipped for a profit.
2. Have a solid plan: Before you start a renovation, make sure you have a detailed plan in place. This should include a budget, a timeline, and a list of all the necessary repairs and renovations. This will help you stay on track and avoid costly mistakes.
3. Get the right team: Surround yourself with a team of professionals, such as a real estate agent, a contractor, and a lawyer, who can help you navigate the process.
4. Be prepared for unexpected costs: It’s important to budget for unexpected costs that may arise during the renovation process. It’s always better to have a contingency budget in place to cover any surprise expenses.
5. Be patient: Flipping a house takes time and patience. Be prepared for the process to take longer than you expect and don’t rush into a sale just to meet a deadline.5
6. Be aware of market conditions: Keep an eye on the housing market and the economic conditions. This will help you make informed decisions about when to buy and when to sell.
7. Be mindful of ethical considerations: Flipping houses can have an impact on communities and individuals, so it’s important to approach the process with respect.