Think Carefully About Fixing-Up And Flipping .

Stories abound about the money to be made buying fixer-uppers and flipping them and you can go to seminars where they will share their secrets with you for a price. Cable TV shows about the subject always end with happy smiling faces.

Even if you are an accomplished do-it-yourselfer you need to understand there are pros and cons of flipping and these projects can often turn dismal.

First you need is to consider the neighborhood. Renovation projects that over improve properties to the point of the home being the nicest on the street are a problem for resale. It may now be a very nice home but the buyer might also want a nicer neighborhood to go with a nicer house. Buying the least expensive home in a nicer neighborhood and improving it to the standards of the other homes is a much better strategy.

You need to do your homework. If structural work is required, mechanicals need replacing, electrical is shot, or a roof is on its last legs be aware that a potential buyer is likely to expect a structurally sound house with working heating, hot water, safe electrical, and a sound roof. The money spent on these type of improvements may not produce a good return. Get a professional to estimate time and materials for every required repair and estimate how it will improve the eventual marketability of the house. 

You need to honestly evaluate what a potential buyers will appreciate and pay for. They will only care about what they can see. Infrastructure, though important, is unseen and probably not appreciated. Money spent to present fresh and clean interior including fresh paint, and new carpets and exterior clean-up is likely  to have a much greater return.

Anyone considering flipping must know that once a project commences anything can happen. Behind that wall being repaired in the basement could be black mold. The sub-flooring under a toilet being replaced could be rotten. Sub-contractors don't show up or do sub-par work. Even if you think you'll have a sense of accomplishment for fixing-up houses, much of renovating and flipping is just not fun.

We agree that money can be made flipping houses but it is not easy and is fraught with real risk if not done carefully.