Real estate and land have long been solid investment opportunities for those who learn about them and learn the best way to gain a return on the investment. For some time now, the so called ‘flipping houses’ movement has been a popular one. Is this phenomenon a truly solid investment potential?
The answer to that question is yes, and no. There are quite a few factors to consider that can be individual to each investment opportunity and the investor themselves. Those factors include the condition of the property, the location of the property and the abilities of the investor to make repairs and improvements. In some cases the flipping game is a very profitable one. These are the cases in which some or all of the following circumstances occur:
Location:
The property or house is located in an area that is in relatively high demand such as a popular neighborhood or well traveled street.
Condition:
The property is salvageable within a reasonable budget that will allow the investor to buy the property, improve the property and sell the house at a reasonable market value and gain a profit.
Cost:
The price of purchasing a house in need of renovation should be lower than the market value of the house.
Ability to fix:
Bboth of the above factors are important, but this is perhaps the most important one. If the investor has the skills or the connections to those who do have the skills to make the repairs and improvements at a lower than average cost, then the return can be a significant one. The investor who is in the best position to make good money from a flipping house situation is the one who is a contractor or other such expert. This type of person can do a lot of the improvements on their own or they know of those who can make the improvements at a low rate.
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