How to Pull Off a Successful House Flip


Flipping a house isn’t exactly easy, but if you watch your expenses and consider the home’s location, you can turn a good profit.


If you’re thinking about flipping a house, how hard or easy can it be? 

While house flipping looks simple on TV, there are a couple things you need to keep in mind to do it successfully. 

First, remember that a successful house flip is one that makes money. You might not make a ton of money, but you do want to make sure you make some money. To accomplish this, remember that it’s not what you sell the property for—it’s what you buy it for on the front end. 

Here’s a great formula to make sure you don’t spend your way out of a profit. First, think about what you’ll sell the property for and multiply that sale price by 70%. If you plan on selling it for $100,000, for example, you’d multiply that by 0.7 and get $70,000. From that $70,000, subtract any expenses it will take to sell the property (the cost of rehabbing the property, commissions, etc.). If it will cost you $30,000 to fix the property up and sell it, you’d subtract that number from $70,000 and get $40,000. 

So, you shouldn’t pay more than $40,000 for a house that will ultimately be worth $100,000.

In today’s seller’s market, it’s difficult to buy a house like that. A lot of investors and house flippers are paying a little more for flip properties, which means they’re making a little less on the back end. 


A successful house flip is one that makes money.


You can also obtain financing to flip a house, but interest rates for home-occupant loans typically aren’t as favorable to investors, so it will cost you more. This is why it’s important that you’re in a position to pay cash. 

The No. 1 factor you need to consider when flipping a home (besides the price) is its location. You can always add a new door or repair a roof, but you can’t pick a home up and move it somewhere else. 

Lastly, remember that you’re an investor. You won’t own the home and live there, so be careful with how you spend money on that home. It might be fun to install a gold-plated kitchen, but you’ll probably be able to get away with a normal kitchen too. 

If you’d like to know more about home flipping or you have any other real estate questions I can answer for you, don’t hesitate to give me a call or send me an email. I’d love to help you.
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Location: Chattanooga, TN, USA

Things to Consider Before Jointly Owning Property


Whenever you purchase a property, it’s extremely important that you 
understand your deed and title.


Today, I would like to share some important information about taking title and owning property with another person.

Let’s imagine you and your spouse are buying a property together. Typically in our area, most married couples will seek deeds where they are “tenants in common.” But, there is another way for people to own property together. This alternative is called joint tenancy.

Let’s say that your mom owns a property and she decides to place you as a joint tenant on that property. This example is a perfect illustration of joint tenancy.


Before purchasing a property, make sure you understand what kind of deed you’re getting and how you’re taking title.

There can be benefits associated with owning property together in this way, but there can also be some pitfalls to watch out for. Adding someone to the deed on the property means the original owner has lost some control. If you bring someone onto the title of your property with you, your asset could be at risk if this new person on the deed runs into financial trouble.

Another consideration is whether the person you’re adding to your deed is going through a divorce. If they are, your property could now be at risk due to the divorce proceedings.

Also, if the reason you’re adding someone to a deed is to eventually gift them the property, you must be aware of the tax implications that come along with this. When you gift something by taking ownership, this is a taxable event. And as I understand it, there is a value limit of $14,000 per year on gifts you give to your children, specifically. So if you gift your child a home through joint tenancy and the half of the property’s value exceeds $14,000, you have created a taxable event. 
 
So, the bottom line is this: Before purchasing a property, make sure you understand what kind of deed you’re getting and how you’re taking title.

If you have any other questions or would like more information, feel free to give me a call or send me an email. I look forward to hearing from you soon.

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Location: Chattanooga, TN, USA

Homeownership Gone Wrong: 6 Key Mistakes to Avoid


There are many pitfalls new homeowners must avoid. Today, I’ll be going over six tips to help you avoid these mistakes.


 If you’ve recently purchased a new home, there is something important I want to share with you today. I hate to say it, but there are a number of ways you can really mess up as a new homeowner. 
“
Remodeling projects don’t always add value.

”
Today, I’d like to go over a few tips to help you avoid these major mistakes. 
  1. Don’t go with the lowest bid for repair or remodeling projects. Just because an estimate is cheap doesn’t mean it is your best option. When remodeling your home, it’s always good to ask around. Find out which professionals in your area will truly do the best job for the best deal. 
  2. Be careful when submitting insurance claims. Records are kept of every claim, so be careful not to submit every little thing. Doing so could hurt you in the future if you ever plan to sell.
  3. Don’t make improvements without professional advice. Remodeling projects don’t always add value. Sometimes, they can even detract from a property’s value. Speak with a professional before making any renovations. 
  4. Keep a record of all renovations. When you do make changes, repairs, or updates to your home, be sure to keep your receipts. This will be important for tax purposes and also later in the event you sell your home. 
  5. Make repairs before you start renovating. It is important to take care of key maintenance items before moving on to other projects. If there are any issues with the home, fix those problems first before making any additional renovations. 
  6. Avoid DIY improvements. Having a professional take care of improvements and repairs will ensure that they’re done correctly. Or, if you insist on doing things yourself, make sure you at the very least enlist the guidance of a professional. I’ve seen a lot of DIY projects go wrong.
If you have any other questions, would like more information, or know anyone who needs help buying or selling a home, feel free to give me a call or send me an email. I look forward to hearing from you soon.

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Location: Chattanooga, TN, USA
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