House flipping is becoming more and more popular, and can be a great way to earn financial freedom. The basics of house flipping involve purchasing a home, renovating it and then turning around and selling the home for more than you paid to purchase and upgrade the home. However, for the uninitiated, the idea of house flipping can seem daunting and expensive. There are many myths out there about house flipping, but the truth is, flipping homes for money can be a lucrative endeavor if you know how to do it properly. If you think you may be interested in house flipping, keep reading to learn the top eight myths about flipping homes that anyone interested in re-investing should know!
While there will always be a degree of risk in any sort of investment, including real estate, flipping houses is not as risky as you might imagine. This is especially true if you're funding your house flipping through a private investor, making your own risk relatively small.
House flipping is a great way to get rich quickly
It's true that flipping houses can earn you a good sum of money if done right, but house flipping is not a "get rich quick" endeavor by any means. Instead, you'll likely start out with small profits that slowly build over time, as you flip more houses.
House flipping is expensive
While having money to purchase and renovate a home is nice, it's not really necessary when it comes to house flipping. This is because house flipping can often be done using other people's money, instead. Whether you go through an investor interested in getting in on a great deal or start out by flipping a home for someone who wants to buy the home, money up front is not always required in order to get started in house flipping.
House flipping requires being good at renovations and construction
This is another common myth that simply isn't true. In fact, if you'd prefer not to get your hands dirty at all, you can easily hire out most of the hard work. Although you might take lose some profit this way, you'd also be ensuring all the work is done properly, with little worry of problems cropping up later on.
You can't flip homes if you have bad credit
This is another big myth that stop a lot of people from even thinking about house flipping if they have bad credit. The truth is, many house flipping projects are funded by private investors, not banks, so your credit likely won't come into play at all. The benefit to you, of course, is that you can flip a home for profit, without worrying about your credit score holding you back. The benefit to the private investor is a nice return on their money once the project is completed, with little to no actual work on their part.
I'll have to sell the home immediately after flipping
While selling the home as quickly as possible after flipping is a good idea, not doing so isn't necessarily a terrible thing, either. This is especially true if you flip a house during a time when the real estate market isn't doing as well as it could be. Waiting for a better market can sometimes have a big payoff, and in the meantime, you can earn back some of your investment (or at least cover your monthly costs) by renting out the property until the time is right to sell.
I need to find the perfect house to flip before investing
The truth is, you will never find the "perfect house" to flip. There will always be flaws or issues in homes that will need to be addressed before, during or after the flip. If you wait until you find the perfect house to flip, you'll find yourself doing a lot of searching and no flipping at all.
The best time to sell a flipped house is in the spring and summer
While back in the 50s this may have been true, these days you'd do better to look at the market rather than the season. The real estate market can be good regardless of the time of year, so never assume you must wait for spring or summer to sell your flipped house.