In the past years, there has been a prevalence of homeowners turning to house flipping. Why not join the trend and flip your own house for the future? Keep in mind that you might need to do some research beforehand. That said, here is a list of 10 things you need to consider before flipping your future home:
1. The right to flip a home
Before you can even think about flipping a house, you need to get the legalities sorted out. This means getting permits and checking with your county if any laws would stop you from doing it, such as the homeowner’s associations, for example.
2. A signed contract with the seller
If you want to flip your future home, you’ll need a signed contract with the seller. After going through all your research and coming up with a reasonable offer, it’s a good idea to step back a bit and put the negotiations on hold. Don’t forget to include certain details in your contract, such as whether you can remodel some things that are already included with the house or if minor changes are possible.
3. Funds for the down payment and closing costs
This is one of the most important things you need before flipping a house. Depending on the situation, you may need to save up more money than usual beforehand. You will most likely need to repay the earnest money that the seller put into escrow after purchasing it from the bank, your down payment which can often be about 25% of the purchase price, and closing costs which can sometimes be up to 4%.
4. Proof of funds to get a home loan
Even if you have plenty of cash saved up for the down payment, getting a home loan can be tricky due to certain regulations. Depending on your credit score, you may have to wait longer to apply for it. Also, don’t forget that you will need to pay off all the money you already borrowed from the bank before getting another loan.
5. An inspection for any defects on the property
This is one of the essential things you need to do before flipping a house. Your future home mustn’t have any defects that might cost you extra money and time to fix or replace those objects later on, such as appliances, the roof, the driveway, etc.
6. A contractor who can work with you on the flip
If you plan on doing most of the work yourself, you will need a contractor willing to work with you and provide materials. This includes someone who knows how much everything should cost and can help you stay within your budget. You may want to consider hiring a project manager as well since this might be too much for just one person to take on.
7. Reasonably priced materials for renovation
Depending on what you plan on doing, certain materials might be necessary to get your project done quickly and efficiently. This may include paint, wallpaper, flooring, and tiles for smaller projects, while larger projects require more heavy-duty things like doors and windows.
8. The right set of tools and equipment
You can’t do heavy-duty work without heavy-duty tools and equipment. The best option is to get a set that has a function for every task you might need to perform while renovating your future home. You can also invest in a heavy-duty mobile air compressor, especially if you’re going to use pneumatic power tools.
9. A good location for your future flip
You might have found a great deal on a reasonably-sized home that can be easily transformed into your future home. But don’t forget to consider things like the location and neighborhood as well, since those factors will affect how much time, effort, and money you will need for your project.
10. An abundance of storage space
You will need a lot of space for storage if you plan on flipping your future home. Make sure that the garage isn’t filled with unnecessary things, and there’s enough room to pull in a trailer since this might be necessary if you want to transport materials from place to place. Make sure that all cabinets and cupboards are also clean and free from old unused things.
In some cases, flipping a house may be more work than you can imagine, but don’t lose hope. It’s best to be prepared before anything goes wrong so that you don’t have to worry about what might happen if the house isn’t flipped properly.
Be sure to follow proper procedures and research everything beforehand, especially if this is your first time flipping a house because this is your future home on the line, after all.