House flipping relies on very quick turnaround times. The best work in the world won’t make you a dime if your holding costs eat away at your profits. Not to mention, the longer your cash is tied up in the flip, the longer you must wait before you can free up money for another deal. This is one of those times where time really IS money. Here are five tips to get that flip sold and off your books quickly, so you can move on to the next deal.
Utilize a Real Estate Agent
Unless you are a licensed real estate agent, you need a good one on your team. This is not a case where it pays to try to do it all yourself. With a good partner, you can offload that piece of the workload to someone else while you focus on all the tasks still on your plate. Let an agent handle the marketing, showings, and contracts that go along with selling a property.
Make a Great First Impression
Once the work is done, have that property professionally cleaned from top to bottom. Put effort into the exterior—nothing turns off buyers faster than poor curb appeal. Trim bushes and shrubs, remove weeds, and plant some flowers for color. Clean gutters, install new house numbers, and spruce up the mailbox. Hire a professional to clean all the windows, inside and out. On the inside, consider hiring a property staging company to add key pieces of furniture if that is in your budget.
Be Realistic on Price Point
House flippers often get caught up in the amount of money they have put into the house, as well as the highest comp, and end up pricing themselves right out of the market. Buyers look at the list price first, and they decide very quickly whether they want to see it. If that list price is too high, it won’t matter how great your finished flip is. That’s not to say you can’t push the envelope a little, but if you go too high, you won’t attract buyers. Time is money; setting the price point is a balancing act between maximizing profit and selling that asset as quickly as possible. Rely on your real estate agent partner to help guide your starting point.
Reevaluate Your Price Point as Needed
If you don’t see a lot of initial interest, consider a price drop. Again, listen to your real estate agent. If he or she tells you there hasn’t been much activity, don’t hesitate to drop the price a bit. People who were looking at the listing online may now see the reduced price as doable for their needs and schedule a showing. You should also talk to your agent on a weekly basis to review the marketing strategy. Maybe the price point is fine, but if there are other factors at work that are keeping people away, you need to make decisions on what to do next.
Take the Right Offer on that Flip
While everyone wants to maximize profit, use caution when evaluating any offer’s likelihood of closing. Do your due diligence to ensure the specific terms of the offer make sense, that the buyer has proof of financing or proof of funds, and that nothing is going to prevent the closing from going through as expected. Otherwise, you will find you are spinning your wheels, and you will lose more in the long run.
Seasoned flippers know how valuable time is. You have a lot of decisions to make when you are ready to sell a finished property. These tips will help you maximize your time and money, so you can move on to the next property.