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10 Tips for First-Time Home Flippers

For those unfamiliar with the house flipping term, it refers to the process of purchasing a home that is in need of repair or restorationusually one that is considered a great buy and below market valuethen quickly overseeing the homes needed restoration, with a close eye on the budget and a goal to swiftly sell the rehabbed property for a profit.

In such settings, the house is referred to as the buyers flip, and those who take on the financial risk are often referred to as the flippers.

House Flipping 101: Eliminate Real Estate Risks

In spite of the nations sagging economy, house flippingtoday more than everis big business. But for a flip to be successful, especially for those who embark on their first-ever house flip, its critical to minimize risks from the start, advised Chad Sloan, a South Carolina-based real estate agent and successful house flipper whos been featured on Flip that House a popular half-hour reality-TV series that chronicles a given home flip from its initial purchase to its restoration and final sale.

Involved in real estate for 13 years, Sloan has successfully overseen flips for a dozen of those years, in addition to giving Flip that House its highest ratings to date with his February 2008 episode. So, aside from serving as a full-time real estate agent and flipping houses for his own profit, Sloan also now serves as a consultant for other house flippers.

Flipping Advice from A Pro

Sharing his expertise in a recent telephone interview from his Columbia, S.C., home, Sloan offered the following top-10 suggestions for wanna-be or first-time flippers:

Do Your Research: Before purchasing a home to flip, do your research; thats the main thing, Sloan stressed. That means research the property, the location, find out how motivated the seller is and so on.

One the most common mistakes beginning flippers make, he warned, is paying too much for a flip from the outset. A motivated seller can be key in getting the right price for a flip.

Find a Good Home Inspector: This is very important. You can usually look at referrals and ask for them from people already in the real estate business. Most people in the business know others who flip houses, and they know people who inspect houses. A lot of people dont want to spend $300 or $350 for a good house inspection that could save them thousands in the end, Sloan warned.

Be Aware of Trends: Keep in touch with trends, such as hardwood floors, which are coming back. It used to be carpet, but now its hardwood," he advised. "Tankless-water heaters are coming in now, too. Its important to know what buyers want so you can move the house quickly once its repaired and remodeled.

Be Mindful of Time and Pricing: If (a flipped home is) priced to sell, vacant, clean and fresh, it will move quicker than a home where a family needs time to move out and then repaint. I like to get in and get out on my flips, remarked Sloan, who flips more than 12 homes year.

DIY and Contract the Rest

Do What You Can and Contract the Rest: Do as much of the small work as you can to cut down on costpaint here and put up shutters there, little things like that helpand then find good subcontractors to do what you cant. And again, he reminded, locate them by referral; thats always the best.

Also, he offered, Always get at least three bids from subcontractors for given jobs. Stick with people who specialize in specific areas. Avoid handymen who are jacks of all trades and a master of none.

Invest in Areas that Will Garner the Biggest Return: Kitchen and bathroom upgrades will give you the biggest return.You dont want to buy the most expensive appliances or upgrades available, but you dont want to cut too many corners, either. If you cut too many corners, it shows. Keep upgrades in line with the price of the house, especially homes in the $70,000-$200,000 price range

Expect the Unexpected: Always expect the unexpected. No matter how well you budget, something will come up to throw you off. Something you can see or that you cant see will happen, such as weather or what happened to me (on the Feb. 9, 2008, episode of Flip that House) when the glass company I was using ran out of glass.Whoever heard of that happening? Sloan asked. I never had, but it did.

Cultivate Curb Appeal

Develop the Home's Curb Appeal: Curb appeal is big. Curb appeal will sell a home first. Some people go in and dont do the landscaping right, like they put big shrubs in front of a small house, and thats not good. Ten percent of what you spend on the flip probably needs to go in the landscaping, he advised.

Contact Experienced Flippers Before Beginning: Probably a lot of people who could do a great job flipping dont want try it, because they get too scared. I would find someone whos doing it and be an apprentice. Just watch them and see what they let you learn from them.

Spring into Action: Spring is always the best time for flipping and selling, Sloan added. For those who choose to flip in the fall or winter, be prepared to wait longer for a sale, he warned. If you can't afford to make the mortgage payments for what may be an extended time during these slower-selling seasons, it's best to wait for warmer weather and more potential buyers.

To view full episodes of TLC's Flip that House online, visit

Readers who enjoyed this article also may be interested in Wheelchair-Using House Flipper is on A Roll.

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