The business of house-flipping has a ton of money-making potential if you know how to properly navigate the market. If you’ve been thinking of flipping houses for a living, you’re not alone.
Flip through the television channels you have available, and you’ll find more than just a few shows specializing in home renovation and house-flipping. Applying the trade of being a successful house-flipper is a bit more difficult that they make it look on television.
Take a moment now to read through a few tips on how to get into the business, and consider if flipping houses is the right fit for your future.
You need a business plan
Getting into the business of flipping houses means you’ll need to develop a well-crafted business plan. Your business plan will act as a road map for your future in flipping houses.
Your business plan should make a point to clearly outline the goals of your operation, evaluate the housing market, and state the real purpose of your business.
You should be able to clearly show that you understand what selling a house entails. Show that you know what you’re doing, so investors won’t have to think twice about lending you the funds you need to keep the ball rolling.
Setup the structure of your business
When you start a business, you should take the necessary steps to set up the legal structure of your business. You don’t want to run into issues down the road, so it’s wise to take the time to legally establish your operation at the beginning of your journey.
Decide whether you would be best suited by forming a sole proprietorship, a partnership, or an LLC (limited liability company). Typically, single-owner small businesses are best formed as an LLC due to the numerous benefits related to the structure.
You need funding to make moves
If you don’t have thousands waiting in the bank to start your new house-flipping business, you’re not alone. Most business owners don’t have the money to start their operation upfront.
It’s more common for entrepreneurs to seek out the capital they need to get started. It’s important that you have a good enough personal financial history to get the ball rolling on finances.
Seek out an SBA backed loan or an angel investor. In short, there are a few realistic ways to find the money to start flipping houses, but you’ll have to have a good credit score to get anywhere.
Start networking with contractors
Once you’ve done the footwork to build a good relationship with lenders, it’s time to start striking up conversations with contractors and other specialists you’ll need to efficiently flip houses.
Taking a rundown home and turning it into a sellable piece of property means you’ll need minds that are honed in many different areas. You’ll need a person to oversee building, electrical, plumbing, permits, licenses, and other aspects of your flip.