First off I wanted to apologize for not posting yesterday, it was bit of a hectic day. Now onto a topic I’ve wanted to cover for a while but simply haven’t gotten around to: House Flipping. There are all sorts of stories about people making tons of money house flipping, including shows dedicated to the topic such as TLC’s Flip That House. Unfortunately there are also the horror stories of people who just didn’t know what they were doing and lost lots of money (think iamfacingforeclosure.com).
All of this leads me to think that there is a market in flipping houses, especially if you’re smart about it and do your homework. Buying a house that could do with some upgrades and renovations in a neighborhood that is expanding is merely a matter of research rather than luck. If you think about it, in all of the major cities in North America people will want to buy a nice house and there will be houses that are being sold off below market price. Taking that house, cleaning it up, fixing it up and then selling it is something that’s happening every day.
So why am I not doing it? Well there are two reasons – first off I don’t know enough about renovations and real estate to get into it. I will fully admit I am green on the subject and I don’t want to pour hard earned money into something I know nothing about. In my case this is enough for me to not do it; unfortunately this doesn’t stop a lot of people. Having a good real estate agent would help a great deal but I don’t know any and if there is a great house for flipping what are the chances that the house will be on the market for long? Probably pretty small. This is a topic I’m interested in and one that I will learn more about in the next little while, but not right now mostly because of the second reason I won’t get into house flipping just yet.
The second and main reason for not investing my money in flipping houses is that I don’t have money that’s dispensable. I don’t have money that I can live without at the moment and I am not willing to try a no money down approach to house flipping. This is because I don’t know enough about it and it would be more like gambling than investing. I think having some investment capital is absolutely necessary for getting into any form of investment in real estate. I don’t have this money, therefore I will have to wait for now. I will get into some form of real estate investment, hopefully in the not to distant future but I need to learn a lot more before I do this, education is the key to most things and this is no different.
[tags]real estate, house flipping, flipping a house, investment[/tags]