Buying and selling property can be an extremely rewarding way to make a living. It will provide you with a varied and interesting working day, as well as the adrenaline rush that comes with securing a fantastic deal. If you’re good at it, property flipping can be extremely lucrative, too.
Who can become a property flipper?
There are no formal qualifications required to flip property. If you can buy houses, and sell them for a higher price, then you’re qualified to do the job. Of course, doing this successfully requires skills that must be built over time.
Specifically, you’ll need to understand money and how to get the best from it. You’ll need to be able to spot the opportunity for profit, and to critically look at a given investment. You’ll also need to be comfortable taking (and managing) risk. Not all transactions will be winners – which, for those looking for a secure source of income, can be unnerving. For those willing to ride the ups and downs, it’s a job worth pursing.
Finally, you’ll need to be able to negotiate, and understand how the auction process works. This is a skill that you can work on by simply visiting an auction, taking notes, and then taking the plunge yourself.
Financing
As we’ve mentioned, flipping houses requires a firm grasp of finance. A house is a significant investment, even at the lower end of the market. You might be investing your own money, or working alongside other parties. In either case, you’ll need to factor the cost of materials such as CLS timber and insulation as well as labour into your calculations. You’ll also need to leave some wriggle room to account for unforeseen costs, like repairs.
You should also bear in mind that you’ll be vulnerable to fluctuations in the price of materials. For example, if there’s a problem in the forestry or shipping industries, the price and availability of timber might become suddenly prohibitive.
Build your network
A successful house-flipping business is rarely a one-person operation. You’ll be working with the help of a wide network of contacts, which might be built over time. For this reason, professionals who are already working within the industry will have an easier time starting work as house flippers. If you have spent twenty years working as an estate agent, you might already have many of the contacts you need to make the new business a success.
Time management
Most flips will take at least a few months. The more efficiently you can manage your own time and that of others, the more quickly you’ll be able to complete the flip and move on to the next. Ultimately, this will determine how profitable your business will be!
