Real Estate Articles | General
- Value of a Great Realtor
- The Good Old Days
- Things you should know when buying a Condominium
- Finding out the Value of Your Home
- The Return of the Investment Property
- Finding Great Fort Lauderdale Properites
- Realtors Need The Right Tool Box to Sell Your Home
- Ft Lauderdale Condos With Moorage
- Flipping for Profit
- Commerical Investing Basics
- Looking ahead at the Real Estate Crisis
- Time to Lower the Asking Price of Your Home
Fort Lauderdale Real Estate
Flipping for Profit - It's back !
'Flipping', is real estate investing lingo, and is nothing more than buying a property and selling it again, hopefully for a healthy profit. It's not illegal, it isn't even unethical, and it today’s Fort Lauderdale Real Estate market it actually signals the beginning of increased investor confidence.
The belief that flipping is illegal, sometimes is the result of media stories designed more to excite than report the news. When it does become illegal, is simply when the practice attempts to deceptively inflate the market value of a property, falsify documents, and collude with others to defraud a buyer or seller. That's definitely is unethical and illegal. But that's not flipping, that's plain old fraud.
To flip a Ft. Lauderdale property, you must first have a Ft. Lauderdale property that is an underpriced candidate, hopefully for obvious and correctable reasons. The goal is to find a 'fixer-upper' and execute a good, cost effective renovation plan for the sole purpose of resale. Bank owned REO properties can make great candidates but the competition for the best potential candidates can be fierce and the process time consuming.
Build a solid relationship with a Fort Lauderdale realtor who you can trust. Discuss that a good solid long term relationship depends on you both making a reasonable return on your time. Talk to friends and relatives, business contacts, bankers, or anyone else who can give you a lead to a bargain and count on your realtor to analyze the value of the property before and after the renovation. Sometimes, simply driving around the right areas will allow you to spot a bargain, look for “For Sale by Owner” signs; occasionally you may find a bargain.
Public records sometimes contain leads to sellers needing to sell. When you find a Fort Lauderdale real estate owner behind on their mortgage payments, who has not decided on a course of action, this may be a perfect candidate to do a deal with. If the value is there, and they agree to sell, the deal becomes a win for both parties, and the community as a whole. You're getting something you want — a property to renovate and turn a profit. They're getting something they want — relief from an unsustainable debt burden. There is nothing unethical about that.
When looking for a great deal in Fort Lauderdale it is imperative to always have your financing in place, if needed, and be prepared to move quickly. If you are buying for cash be able to prove your ability to close with either a bank letter, or a bank statement showing available funds.
To be successful at flipping you need to master a learning curve that starts with learning how to spot a salable property and learning to judge the market. You need to learn about the cost of property repairs, the permitting process and what repairs will return the best dollar for dollar. If you’re not planning on doing the work yourself you will need to put together a team who understands plumbing, carpentry, and other skills. The goal is to put together a team that will give you quality work at realistic prices knowing that you will keeping them busy as long as the overall project is successful.
You need to have an active personality and be an active participant in the process. Flipping involves dealing with lots of details in a short span of time. Time is money and the goal is to have the entire deal ready to close in 90 days. It is important that the buyers recognize the value in the project you just completed.
You need to hone your negotiation skills with your team and develop relationships with contractors and lenders that can be relied on to move quickly when you need them to. You need to be able to work well with your realtor and be able to rely on their performance the same way they will be relying on yours when great properties come on the market. You need to learn about contracts, real estate law, and study the tax consequences of buying and selling properties within a short time frame. Flipping homes is a business and honing your skills is what will make you successful at it.
If you are thinking of flipping homes in the Fort Lauderdale Real Estate market, the team at Eric Miller and Associates is always here to help.
Eric Miller is an award winning Florida Realtor, salesperson and broker. His website Fort Lauderdale Real Estate provides the most complete buyer, seller and investor information for the Fort Lauderdale Real Estate Market.