Flipping houses can be lucrative for investors and agents when done right. New investors rely on experienced real estate agents to provide support and guidance. From finding investment opportunities to realizing a profit, agents should be with investment clients every step of the way. Savvy agents can help a client buy a property then list and sell it. Reviewing this flipping a house checklist with investors shows an agent’s dedication to assisting investors to achieve, or exceed, their financial goals.
Establish an Investment Budget
When people purchase a home, they typically get pre-approved for a mortgage. Buyers know how much they can spend and can prove they are financially ready to buy a property. Investors should also know how much money they can spend on the project and from where the funds will come. Options may include personal cash, financing, hard loans, and business loans. Smart investors have their funding ready before they find an investment property.
Investors also need to consider other costs to avoid common house flipping mistakes. Expenses may include rehabilitating the property and getting certifications of occupancy for improvement. A proactive agent outlines possible costs and has a team of professionals who can advise investors, if needed. Include accountants, attorneys, inspectors, engineers, contractors, electricians, plumbers, and bankers. Encourage reciprocal referrals and give local investors a network of resources they can trust and generate more leads.
Find an Investment Property
Agents who prove their localized expertise are favorites among investors. Busy investors need someone to be the eyes and ears of the neighborhood, finding investment properties as soon as they become available. Discuss the types of properties the investor is willing to purchase. Then review the amount of work they want to put into a house before flipping it. Search for properties that have potential, based on the investor’s budget and desire to dig into a major project. And provide a list of comparable sales in the area, so investors are well-informed about the property’s potential.
Comb the area for neglected, abandoned, and distressed properties. Search for foreclosures, short sales, zombie properties, and long distance inheritances. Then check the local records to contact the property owner and see if they are willing to accept offers on the house from qualified investors. Stay on top of real estate listings to find out about investment properties before everyone else does. Ask the client the best way to communicate quickly, such as by phone call or text. Include real estate listings for investment properties in social media posts to attract more investment clients.
Let the Negotiating Begin
An agent must be willing to pound the pavement to reap the benefits of working with investors. Often several deals fall through before an investor finds a viable property with the right terms. The costs to the investor include buying the house, covering closing fees twice, and renovating the home to flip for a profit. An agent needs to be patient as investors work through these terms and make a final decision.
Timing also depends on the type of flipper. An experienced investor might be willing to take on risks to act swiftly on a property. Newbies usually want to hire a home inspector to get an idea of what the property will cost and its profitability. Once an investor is ready to move, it’s time for an agent to negotiate to get the best possible deal. Be prepared to counter other investors and agents. It may take a few rounds to get a deal that sticks.
Renovating and Listing the Property
Investors want to renovate and flip the property as quickly as possible. The longer the investor has the house, the more money goes into maintenance costs such as taxes, utilities, and landscaping. Agents can help investors by offering tips on what to fix to attract potential buyers. Review the importance of curb appeal. Encourage investors to repair the fencing, driveway, roof, gutters, lawn, and add seasonal landscaping. Agents can offer to spread the word about a property being renovated for sale once the exterior looks inviting.
Then guide investors through the interior renovations, ranging from appliances and HVAC systems to flooring, walls, plumbing, and electrical wiring. Encourage the investors to use neutral paint colors and stage the home with modern furniture. Provide a list of local contractors who are licensed, insured, and reputable. An agent who is a valuable resource is likely to get the listing when investors want to sell.
List, Sell and Repeat
Once the house is ready for sale, investors and real estate agents are prepared to reap the rewards of all this hard work. Agents should have possible buyers lined up to view the property the minute it hits the market. Being well-prepared proves to investors the value of paying a commission fee for a real estate agent to list and sell the property quickly. Affiliated Better Homes and Gardens® Real Estate agents have access to a vast social media network to spread the word fast.
Also, be ready to list the property and market it aggressively. Use professional photographs, well-written descriptions, and innovative marketing tools to bring attention to real estate listings. Share the property with local bankers, attorneys, and contractors who might have their list of potential buyers. Help flippers get the most for their investment.
The first step toward establishing a meaningful and profitable relationship is carefully reviewing this flipping a house checklist with investors. From finding the right properties to scoring an investor’s future real estate listings, agents who chose this niche can enjoy a very successful career.