On the surface, flipping houses seems like a simple process. You purchase a property for a low price, perform renovations, and then list the house on the market to make a profit. However, some property flippers will do everything by the book, match their price point to comps in the area, and still end up waiting a long time to get a buyer. Understanding homebuyers and what they want, as well as future plans for an area, can help property flippers create a strategy to renovating and selling homes quickly.
Drilling Down into Comps
Looking at comps based on acreage, square footage of the house plan, and the number of bedrooms and bathrooms. Drilling down, two properties that look the same on the surface can differ greatly in price if house flippers know the items homebuyers are willing to pay extra for, such as separate office space, smart appliances, energy-efficient engineering, home security systems, and more. Little things that bring a property closer to being “turn key” can really boost the listing price of a fix and flip project.
Home Buyer Trends
The real estate market is fluid, and societal changes influence the needs of homebuyers. The pandemic of 2020 moved homebuyers to look for properties that offered separate space to use for work and school. Accessible technology drove buyers to look for smart homes. Buyers are also more aware of the materials used to build homes, and know the advantages of concrete core siding compared to aluminum or vinyl. While people once looked for homes with an easy commute to work, that is no longer a priority, as people are working more from home now, and for the near future.
City Plans and Property Flippers
When businesses come to a new area, surrounding neighborhoods change. Property values go up, smaller businesses emerge, and homebuyers are willing to pay more. When it was revealed that Amazon was opening a campus in Arlington, VA, it opened up a swathe of opportunities for property flippers to provide homes for employees, and to revitalize surrounding communities. Property flippers should check local notices regularly to see what new businesses are coming or going to adjust their strategies.
The Capital Rams provides loans and lines of credit to property flippers nationwide. Contact our offices today to learn more.