What a Pink Floyd Song Can Teach Us About Flipping Houses
"Ticking away the moments that make up a dull day
You fritter and waste the hours in an offhand way.
Kicking around on a piece of ground in your home town
Waiting for someone or something to show you the way."
-- "Time," by Pink Floyd
By now, you probably know that house flipping is all about time...For each passing day that your house remains unsold, a portion of the profits are lost. If you "fritter and waste the hours in an offhand way"...you'll end up frittering away your profits too...
Time is a concept you have to keep in mind when entering the house flipping business. Time is your enemy. The longer you take to finish your flip, the less you make.
Time waits for no-one
Feels like the first time...
Does anybody know what time it is...
Time is on your side...
Not always on the last one.
All rock n'roll lyrics aside, time should be at the top of your list when you are creating a business plan for your house flipping business. However, inasmuch as you are trying to shorten the amount of time you spend flipping a house, you shouldn't compromise on the quality of your work.
Racing against time does not mean this...
Yes, time is the enemy, but the only thing that comes before time is quality. If you are thinking of cutting corners just to get rid of the house, don't be surprised when it all comes back and nips you in the butt. Those shortcuts you are thinking of taking will save you a penny or two, but they will completely damage your reputation.
Can you sell a house flip in one day? Yes, but selling a house flip within 24 hours happens very rarely.
I just held onto one for WAY too long, and it really hurt us. Believe me when I say the holding costs that come with house flipping can add up real quickly.
On this one, it cost me well over $30,000 in profit. We still came away profitable thanks to the 70% Rule, but man, was it painful...
So to beat father time, try these three house flipping tips that will help you flip a house in the shortest amount of time possible.
Three tips for flipping a house fast
1. Set a definite timeline for completion
The importance of having a timeline for your house flipping projects cannot be emphasized enough. If you want to run a successful house flipping business, you have to hold everyone accountable, and the best way to do this is to set a definite timeline.
The first thing that you should do is set up a meeting with your general contractor and subcontractors. This will ensure that everyone who is working on your project is on the same page as you. During the meeting, you should review the entire schedule for repairs.
Break down the order of repairs and emphasize the importance of sticking to the schedule. Everything that you discuss should be documented.
2. Put a price on the house ahead of the market
Most people make buying decisions based on price. A home buyer will make price comparisons of your house with other homes within the same area in the same market. The price you put on a house will determine how fast you will be able to flip and sell it, so you have to competitively price your home.
Start by looking at the price tags on other homes within the area you plan to flip the home. Become an educated seller and stay updated on local sales trends. An educated seller knows the demand within their area. Demand varies from one area to another. For instance, a house with an ocean view might have a greater demand than one without even though they are located just yards apart.
The key is to find houses within your area that have similar characteristics. How much do they cost, and how long have they been in the market? What are the sales trends? Do the prices increase during winter or during summer? From there you can use your findings to align your price accordingly.
3. Generate some buzz
You have a greater chance of selling your house quickly if you create a buzz about it before putting it on the market. You can use social media platforms to generate interest. Use Facebook and Instagram to share impressive photos, and use Twitter to share the rehab process. Create online conversations by talking about what's interesting about the area the house is located in and what geographical features make the place so attractive.
You can also create buzz around your property by staging it professionally and pricing it competitively.
Hire a real estate agent who has an online business presence and will go above and beyond to market your property. Experience and longevity are admirable qualities to look for in a real estate agent but it's better to look for one who has a successful track record of selling property.
Yes, you do have to pay the 5% commission, but the headaches it will save you will be well worth it.
What do you think? Do you have any other tips for flipping and selling property in the shortest amount of time possible?
I'd love to hear your thoughts on other time saving tips you use...or even your favorite "time-themed rock songs"... that would be cool too.
This article originally appeared on biggerpockets.com.
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