The primary goal of any home flipper should be to earn the maximum profit with minimal costs. Our team of experienced professionals has learned how to adhere to this practice, even in the difficult Long Island market. Between selecting the home and selling it, there are several steps, and we at Atlantic Shores Home Buyers have mastered each one. Read on to learn more about how we consistently maximize profits in the Long Island home flipping market.
1. Pick the Ideal Property
Before you can sell it, you must find a property worth selling. There are a number of factors that we take into account, including:
- Location: To be a viable property, the price of the home must be worthwhile, considering the neighborhood.
- Condition: While all home flipping projects require repairs, the best homes need the least repairs. This applies to the home’s structure and aesthetic appearance.
- Proximity: Even if the home is in a neighborhood with a high selling potential, excessive distance could create issues down the line.
- Low Initial Value: The property of the home should be low, considering the local market.
- Kitchen/bathrooms: Bathrooms and kitchens that are both functional and decorative tend to drive sales.
Taking all of these property selection factors into account allows us to make an informed decision.
2. Understand (and Follow) the 70% Rule
Making projections about the value of the home is critical to our overall home flipping strategy.
The 70% Rule relates to the after repair value (ARV) of the home. In essence, flippers should not pay more than 70% of the ARV, after repair costs. For higher valued homes with more income potential, there may be some exceptions.
However, keeping this guiding principle in mind will help you generate a higher return.
3. Create a Budget, and Stick to It
Minor incidental costs can add up quickly. To keep your home flipping project profitable, you need to outline a way to create and keep a home repair budget.
The first step of doing this is identifying and prioritizing repair tasks. Figure out which aspects of the home need the most attention. And, determine how you are going to apply your resources. Depending on the condition of each room, you may want to spend more money on particular repairs. Assessing potential tasks like this helps to inform our overall process.
The next step is to estimate the costs of materials based on in-store prices. Taking an accurate inventory of these costs will prevent difficult choices about repairs down the road.
Based on input from the construction team, we then determine what the costs of the structural repairs will be. This includes lumber, foundation repair, and other related expenses. With our in-house construction team, these approximations are generally accurate.
Overall, be sure that this budget aligns with the 70% rule, and that the home flipping costs still make for a profitable investment.
4. Stay on Schedule
Home flipping projects that take longer than expected are more than a mere inconvenience– they can affect the bottom line.
Opening the home up to further expenses– such as mortgage payments, electrical bills, and insurance detracts from the maximum profit. As seasoned home flippers, we have learned to keep renovations punctual.
The primary way to do this is hiring an experienced, honest and reliable construction team. Because we have an in-house construction team, we can reasonably trust that all operations remain on schedule.
5. Quality of the Home Matters
As home flippers, it’s important for us to cover our bases by repairing all necessary areas in the home. Generally, this means that there will be structural repairs, kitchen improvements, interior painting, and possibly more. And, while listing these renovations will draw prospective buyers, it will not be enough to seal the deal.
In order to earn the highest possible return, home flipping properties need to leave a lasting impression. That’s why we hire quality contractors with polished home renovation skills, making for lasting repairs.
6. Take Great Pictures
After your construction team has completed renovations, the work is far from over. To capitalize on these investments, your advertisements must incorporate pictures that generate interest.
In order to earn maximum revenue, we work with a team of real estate agents who are knowledgeable about the Long Island area. With their expertise in the selling aspect of this operation, we are able to sell homes quickly and easily.
7. Set a Fair, Market-Oriented Price
If you have executed the rest of your home flipping project correctly, then finishing the flip should be simple. Strategically choosing a price point helps us to ensure that the flip is profitable for all parties involved. Depending on the local market, this is generally slightly below the market price.
Long Island Home Flipping
Opting to invest with an established home flipping company is the safest way to earn a guaranteed high return. At Atlantic Shores Home Buyers, people choose to invest with use because they recognize the valuable opportunity, without substantial risk. If you are ready to capitalize on this investment opportunity, contact us.