($300,000 x 0.70) - $50,000 = 3. Key Phases of a Flip
Finding "distressed" properties—houses that are physically run-down, in foreclosure, or owned by sellers needing a quick exit.
You can fix a house, but you can’t fix a neighborhood. Always buy the worst house on a good block, rather than the best house on a bad block. 5. Financial Considerations buying and flipping homes
Example: If a house will be worth $300,000 once fixed, and it needs $50,000 in repairs:
Experienced flippers often use the to determine if a deal is worth the risk. It suggests you should never pay more than 70% of the property’s After-Repair Value (ARV) minus the cost of renovations. ($300,000 x 0
Listing the property quickly. In a "hot" market, a well-flipped home should sell within 30 to 60 days. 4. Common Risks to Avoid
The goal of a flip is to minimize the "holding time." The longer you own the property, the more your profits are eaten away by taxes, insurance, utilities, and interest payments (often called ). 2. The Golden Rule: The 70% Formula Always buy the worst house on a good
(typically 5-6% of the final sale).