By Jim Ingersoll

Flipping houses looks so fun and easy on TV!  What is it like in real life?

This is a house we bought and sold retail (flipped).  Have you tried it?  Leave me your comments below on what went right and what went wrong!  When everything goes right you walk away with a nice chunk of money, but if too many things go wrong you can walk away with a loss.

Find value add opportunities for your flips

This cape cod did not have a finished second story.  This is something we look for when buying houses.  Easily expandable space is a nice value-add.  For a cape like this you can add several hundred square feet without a full addition (i.e. foundation, new walls, roof).  This is one type deal you can still find on the MLS, because it is unfinished square footage and often missed in the remarks section of listings.  The same can be true for a full basement and sometimes for rear additions and sun rooms.

Buying houses to flip

When we buy houses we buy them as-is and close fast.  That allows us to make offers that motivated  sellers love and they trade equity for quick cash on the sale of their property.  Every deal starts with a motivated seller.  The more motivated they are, the better the deal can be.  We love writing contracts direct with the seller while we are sitting in their kitchen or living room.  No realtors, no brokers, no one to get in the way.  Our contract makes it very clear what the benefit to the seller is (fast closing, cash, as is, no inspections, etc).   It is common for sellers to love our terms and not love our initial price.  We give the seller permission to say “no” and negotiate.  Starting with a “no” and getting a counter establishes a pathway to getting a deal.

Rehab your financing before your rehab the house

This home we purchased with private money at an interest rate that will provide a great return for the lender and still work well for us without needing a bank mortgage.  We get to operate without needing a loan officer, without needing an appraisal and without worrying about under-writing criteria, credit, etc.

Here is the exterior renovation on the roof that consisted of tearing off original and installing new 30 year dimensional shingle roof.  Sometimes you can save some money to go over top of existing or use a 3 tab shingle, but our standard is to tear off the old roof, replace damaged decking boards and replace with 30 year dimensional roofs.  A new roof also adds a ton of curb appeal which is critical when flipping houses. We also demo’d the back deck you see and built a brand new deck for future home owners.  Finally for exteriors we also replaced all of the windows!

1.  Demo Day
   Get your demo done first thing.  The day you close on your property order your dumpster.  You will want to complete all demo first.  This includes any walls you are taking down, ripping out your kitchen and baths, etc.  This is the kitchen and bath of the cape cod following demo.
   
    

2. Framing

We took a wide open 2nd floor and made a master bedroom, jack and jill bath and another bedroom.  That added a ton of good square footage to the house.  In order to add a master bath you have to layout your floor plan.  We typically bring all our contractors together and solicit their opinions to help us lay everything out.  We bring the HVAC, electrical, plumbing and framers together for a planning session.  We then layout it out with paint so we can all see it right before our eyes so to speak.  Building out the second floor added a ton of square footage and space to this cape cod flip and allowed us to create the margin that works for flipping retail.

3.  Trades

Once framing is completed, move your trades in to do all the rough in work.  This includes HVAC, Plumbing and Electrical.  This must be completed and inspected prior to continuing.  This can be a slow piece of your overall rehab, but once you are complete and pass your inspections everything goes fast all the way to finish.

4.  Drywall

Once trades are gone you can begin new drywall, mud work and skim coating your walls.  This can take several days as they come back for sanding and mud work and once complete it is time to paint!  We have been using Sherwin Williams repose gray on our interior walls.  This project we did a few years back when we were still using a tan color.

5.  Final

Once the house is painted you can install your lighting, outlets and ceramic floors.  After that you are set to install your kitchen cabinets, final bath fixtures and head towards the final stretch including final flooring like refinishing hardwoods, etc.

6.  Sell it and cash your check

In today’s market this is the easy part.  Low inventory of nicely renovated homes allow them to be sold fast and for top dollar.  As long as you complete your renovation on time and on budget and your final price matches what your market will pay you will enjoy a nice pay-day!

What do you think?   Can you see yourself doing this?  

Think it works just like HGTV?

Have questions, comments?  Just leave them below for me and consider sharing this information on facebook, twitter, linked in, etc.