You can earn much money when fixing, remodeling and selling houses. This business, known in the US as "flipping houses." People make thousands of dollars annually by buying old homes and revitalizing them for profit. Best of all: it's relatively easy to start in 2019, and the requirements are just a little.
How to make money remodeling houses?
The process of fixing a house or remodeling to sell is simple: you start by buying a home to be repaired and then sell it for a profit. However, the process is a bit more complicated than this.
How much money can you earn by fixing houses? The average earnings for each repaired home are $ 25,000 to $ 72,000. It would help if you had several preparations in mind before you start to dedicate yourself to this new profession.
Buying houses and fixing them is very profitable, but you probably will not make that much money on your first repaired houses. This is because you need to learn some business lessons: how to buy properties at a reasonable price, estimate repair costs and the costs associated with them.
To help you start and avoid mistakes that can cost you dearly, we have created this guide in which we will tell you how to succeed and make money fixing and selling houses.
What is house-flipping?
The ideal home to make money fixing and selling is one that can be easily renovated or a house that only needs some repairs. Usually restoring a house and selling it for a profit involves things like painting it, buying a new carpet, renovating the kitchen or some kind of work in the garden.
There will be repairs that you can do for yourself, which can save you money, but there will be jobs that will require the help of experts, such as electricity or plumbing.
How much money do you need to start?
The amount of money you need to remodel and sell houses will significantly depend on the area where you will work. Although there are financing options, you must understand that this amplifies your risk, since you will be working against the clock to complete the repairs and sell the house.
Because the average home cost in the United States is around $ 150,000, your profit for each renovated home will be between $ 25,000 to $ 50,000.
If you buy a property for more than $ 150,000, you can earn more money since you will probably have to do more repairs to this property, which will increase the sale price. It is important to know that buying and remodeling house to sell is a highly competitive business. You will have a competition with other people who are hoping to buy homes at low prices, restore, and sell them for a profit.
The best long-term strategy is not to buy a large property and renovate it; this will be extremely risky (especially when you start in this business). You will have better results when buying several properties with a lower sale price and repair them. In this way, you can diversify your risk.
What are the costs associated with home remodeling?
Making money renovating homes may seem easy at first glance, but in a short time, you will notice that there are many associated costs. You will have expenses such as financing, sale (commissions from your real estate agent), insurance, property taxes and much more.
In general, you will have to consider these costs each time you buy a house to renovate it:
• Loan / Interest: $ 2,000- $ 8,000
• Property insurance: $ 500- $ 2,000
• Taxes: $ 500- $ 3,000
• Maintenance (yard, snow, lawn): $ 250- $ 1,000
• Costs of sale: $ 10,500- $ 15,000
• Other expenses: $ 0- $ 6,000
These costs accumulate even before making the first repair to a house. On average, you should expect the prices before selling the repaired home to vary from $ 15,750 to $ 41,000. The costs of sale will also vary depending on the house. Many buyers will ask you to pay the closing costs, which can be 3% or more of the sale price, although you can save money if you become a real estate agent.
Depending on the location of the property, you will also have to pay for title insurance, a closing fee or a lawyer. This variation shows why it is so important to calculate and control your expenses if you want to make money buying and repairing homes.
Despite all of the cost, it will be a useless effort if you don’t know how to boost your sales. We at Drone and Photo provide you the best video drone shoot of the property, so the commercial real estate you sell have a WOW factor in boosting your sales your revenue. Contact us today and let us help you get more buying possibilities!