The term house flipping conjures up images of a judo move, but actually the pejorative term applies to the practice of buying a home at a low price and quickly reselling it at a higher, profit making price. House flipping is in the news right now as the conditions for it are ideal…for those who have cash and some courage!
Conditions are perfect for house flipping because of the high rate of distressed properties available. While pre-foreclosure and bank owned properties can be flipped for a profit, the competition for them is usually intense, which can drive the price up just enough to make them to risky for flippers. The flippers dream is foreclosures, those homes that are sold by auction, often on the steps of the county courthouse (as is the case in Butte County). Here is where the real deals are had. Because the auctions require cash or immediate proof of it’s availability, the competition is greatly reduced. Those with ready funds can often buy foreclosed homes for pennies-on-the-dollar, leaving lot’s of upside when they go to resell.
Buying foreclosures is risky business though. To be successful buyers must carefully research the property they will be bidding on for unseen liens and easements that can come back to make the property unprofitable or unsellable. They should also inspect the property physically for defects and possible repair costs. Potential buyers should work with a Realtor to get the most relevant ‘comparable sales prices’ for similar properties, so they have a clear picture of what price they will have to put on it to resell it quickly, and a real estate agent can help assure the property receives the proper marketing to flip it in the shortest amount of time.
With proper research, preparation, cash and nerves…and the help of a Realtor, houses can be flipped as profitably in Chico as anywhere in the country!
Conditions are perfect for house flipping because of the high rate of distressed properties available. While pre-foreclosure and bank owned properties can be flipped for a profit, the competition for them is usually intense, which can drive the price up just enough to make them to risky for flippers. The flippers dream is foreclosures, those homes that are sold by auction, often on the steps of the county courthouse (as is the case in Butte County). Here is where the real deals are had. Because the auctions require cash or immediate proof of it’s availability, the competition is greatly reduced. Those with ready funds can often buy foreclosed homes for pennies-on-the-dollar, leaving lot’s of upside when they go to resell.
Buying foreclosures is risky business though. To be successful buyers must carefully research the property they will be bidding on for unseen liens and easements that can come back to make the property unprofitable or unsellable. They should also inspect the property physically for defects and possible repair costs. Potential buyers should work with a Realtor to get the most relevant ‘comparable sales prices’ for similar properties, so they have a clear picture of what price they will have to put on it to resell it quickly, and a real estate agent can help assure the property receives the proper marketing to flip it in the shortest amount of time.
With proper research, preparation, cash and nerves…and the help of a Realtor, houses can be flipped as profitably in Chico as anywhere in the country!
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