Friday, June 19, 2015

Flipping Houses and Pocketing the Profit

House flipping ranges from picking up a one-time property deal and turning it around for a tidy profit to making a living at buying distressed, foreclosed, run-down or other properties, repairing, cleaning up, renovating, painting or all of the above.  It can be an occasional hobby or a bona-fide vocation.  It's not for the faint-hearted, as much planning, financial investment and hard work goes into house flipping ~ including, but not limited to, having a good relationship with a dumpster rental company that is reliable and can move quickly once you close on your deal and are ready to get started.  Reliable partners that can move as fast as you need are a major key to this game.

People buy, sell and move all the time, but house flippers are generally considered "in the business" when properties change hands in less than 12 months.  The serious ones may have several properties in various stages of fix-up at the same time, and others might do one a year on the side. 

The greater Tampa, St. Pete, & Clearwater region is prime for house flippers from the old beach condo to the foreclosed mansion.  The older homes in South Tampa and St. Pete seem to be hot areas of interest today.  Buying any property and re-selling it without doing anything happens, but real value and higher profits are found in the renovation or at the least major sprucing up of a house or condo.  

To get started, you need a few things besides a toolbox ~ 

  • Knowledge of neighborhoods, real estate prices, demographics, current market trends
  • Financial expertise in fees associated with home buying and selling, like Realtor commissions, appraiser, home inspection, bank financing, building permits, closing fees
  • Vision of what can be and the repair and renovation work and associated costs
  • Negotiating skills
  • Good relationships with a dumpster rental company, plumbers, painters, electricians, landscapers and roofers, among others
  • Management capabilities to prioritize, track expenses, deal with suppliers, etc. 

Earlier this year in the Tampa Bay times, reported in their article Tampa Bay Ranks Among Nation's Leaders in House-Flipping Profits that local flippers were averaging 57% gross profit during the first few months of 2015.  According to, a leading source of housing data, close to 27,000 homes were flipped nationwide during the third quarter of last year with an average profit of $75,990. "The record-high average profits per flip in the quarter demonstrate that flippers are still filling an important niche in an aging housing market with historically low levels of new homes being built," states Daren Blomquist, vice president at RealtyTrac. "The most successful flippers are buying older, outdated homes in established neighborhoods and rehabbing them extensively to appeal to modern tastes."

House flipping has increased in popularity among the less experienced with a many TV shows dedicated to buying and selling homes.  You can see Bin There Dump That on a few TV shows like Property Brothers & Holmes on Homes.  Check out our "seen on TV" page on our website.

You cannot flip houses as fast as pancakes, but it is still a fast-paced endeavor that has financial risk as you have money tied up in the purchase price as well as labor and materials.   If you are a contractor and can do the work yourself, the profit is even bigger.  If wiring and roofing are involved, and you are neither an electrician nor professional roofer, it's wise to get an estimate from a licensed contractor before bidding on the property.  Having reliable partners is a must, without them, time is wasted, money is lost and your profits dwindle.  Many flippers use a combination of professionals alongside their own work.  When it's all said and done, there is probably blood, sweat and tears along with that tidy profit, and you can smile all the way to the bank.

If you are flipping a house, check out Bin There Dump That for your Tampa area projects.  They offer same day services, delivery on Saturdays, and help keep you moving.

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