How would I start a house flipping business?

I want to start my own house flipping business how would i do that any advice? I know you have to have a good credit. How much money would you need to start?

Get a time machine and go back 5 years when it made sense to do this.

Have you not heard the old saying "buy low, sell high?"
You're planning on doing the exact opposite!
Here's another one you may not have heard:
"A fool and his money soon part ways"

In some markets, seasoned flippers are still succeeding, but to be perfectly honesty, if youâ€™re asking how to get started with this, now isnâ€™t the right time for you. The current market is not kind to those who are learning the process.

Well, there is no better time to buy than now. If you have the credit and the money, snatch up as many properties as you can. This is indeed a buyers market. With that being said here is your caviat: IT IS A BUYERS MARKET! That menas, you should not flip your properties immediately, because you will not make a profit. I would suggest, purchasing properties that have little to no defects in them, you know, properties that you can slap a coat of paint on and then stick a tenant in. You want to rent them out immediately and make a profit on them so that you can make a profit while riding out this market. Also, when the market turns, it is going to be FLOODED with houses and your will not differentiate, so you will have to ride that out too. But int hat time, you will be preparing the home for flip; painting, upgrading appliances, adding on porches, etc. So when the market settles, and the flood will settle faster, especially with FHA about to bring out their NEW FHA loan, which will be structured for a higher loan amount (currently at 213,750 maximum; they want to be at the 417,350, with is our high for a conforming loan. Probably won't get that high but will reach the 300's.) first time home buyers and such will be purchasing homes if not quickly, they will begin doing it steadily. So the thing you need is credit, money and PATIENCE. Also, you should try to buy in the midwest; proerty value has been maintained in the midwest and portions of the South. Also, I would buy smart; Try to find a street where there are several bungalows/ houses/ apartments/ two family flats on the street and see if you can't buy the lot of them. By doing this, you can dominate that area, and when it comes time to sell, you will basically be the one setting the price range on that street; in essence, your houses will sell according to what YOU sold your last one for. Get it? Good, now go buy some homes! OO! Almost forgot, try holding your property for two years if you want to avoid Capital Gain which can be from about 15 to 18 percent!

OK, you are watching too much of those home flipping TV shows.

What they FAIL to tell you is that was the peak of market speculation by 2005. If they re-did the same shows with the same people (speculators) holding the same (property), they are going under left and right.

Unless you are trading 10MM+ real estate in Manhattan or few other still hot areas, this is a bad time to be thinking you can flip real estate. Watch the stock market ever day - CNBC and you'll get an idea of the reality of where the mortgage, builder, lender, financial industry is - getting crushed. Been shorting the begeebers in this sector since summer.

I have been arguing since 2004 that the FED made the wrong move on raising rates 17 times since 04. See me prev posts.

I have been bearish on real estate since 2005. Sold my house in 2005. Out of it since, still waiting for price to FALL to reality.

Igor all the idiots who have their head in the sand and think the market is "near bottom" or turning around soon, or by next spring. They are all WRONG! And have been wrong for the last 2 years. Many mortgages will reset ARMs issued 2 years ago again next spring. This means more foreclosures are expected. This means the issue will continue to get worse before it gets better.

The market is going through a HISTORIC "shake out."

Here's what to watch for:
1. Consumer sentiment. (google it for definition).

2. All the major financial institutions (banks, mortgages, insurers that insure mortgage, etc.) Watch their earnings, and news. You can't have a (real estate) market turn around if consumers are bearish on the economy and (financial) institutions continue to report $ Billions and $Billions of quarterly losses due to bad real estate loans.

3. Watch housing permits. If you see 2-3 quarters of new housing permits taken out by builders might suggest builders are comfortable building again.

4. Ignore the one report or up blip in the market. Ignore overly optimistic real estate agents. Most don't know **** about how financial markets work. And until you pay attention to the financial markets, you won't have a clue how the real estate market is really doing.

5. Ignore mutual fund managers, etc who think we are not going into recession next year. We are in recession! The economic data and financial numbers tell the real story.

All these positive 'up ticks' are short term technical indicators, (google "dead cat bounce") that have consistently failed to keep a rally going. The trend is down. Prices will drop further. Banks canot afford to hold on to huge foreclosure losses. They will have to dump on the market at some point.

What does this mean? Housing prices are coming down, and have been. Foreclosures are "through the roof." (realtytrac.com).

I could do a seminar on all what you need to know, how to buy, etc. Just don't go in and think you are going to be making money right now and for some time.

If your still nuts to get in this house flipping business:

1. You need stellar credit.

2. You'll need 5-20% down. And you'll prob start loosing money before you even close.

3. I would incorporate, but unless you can put 40%+ down, you may not be able to get a loan unless you personally guarantee it because banks are afraid of people defaulting - even with stellar credit.

4. Remember it's location, location, location.

5. Interest rates are highly likely to continue to come down another 50 to 100 basis points (1/2 to 1.00% over the next year). This helps new buyers purch at lower rates and can help people underwater in there house, but the reality is, the momentum of carnage is playing out, and their is little the FED or anyone can do to reverse this trend right now.

Like it or not those are the facts. Read my bio for more.

Need more evidence? Go to "yahoo finance" and type in any of the following stocks - read associated news and how stocks tied to real estate have plunged. It's not over yet.

BROKERAGE:
MER
BSC
LEH
MS
UBS
ETFC

BANK:
BAC
WM
COF
WB

MORTGAGE LENDER (non charter bank)
CFC
JLL
CHC
TMA
DRL
AFN
CRZ
LUM
NFI
IMH
FRE
FMN
IMB
RAS

MORTGAGE INSURERS:
PMI
MTG
MBI
ABK
RDN

Did you read anything overly bullish about this financial sector? Follow the money - watch the numbers to get an idea of future trends.

Good Luck!

The down rating was marked before I was done editing this post. OK I'm done editing. Now rate me :)

No offense to real estate agents. I know lots, and related to one.

Right now, you should not be considering doing anything with regard to 'flipping houses'. The real estate market is very unstable, and you may well find yourself owning one or more properties which you cannot sell at the price you need to make a profit.

It's very much a buyer market, and you could find yourself in a financial bind if you invest in a property, repair it to standards and attempt to sell.

Be very careful - housing prices are falling, and one of the reasons is that many people overextended themselves trying to "flip" houses.

To get the deals you need all cash and can close in 7 days.

The best deals are finding DISTRESSED SELLERS, NOT DISTRESSED PROPERTY BUT DISTRESSED SELLERS.

If you tell them: I want to buy your home for cheap IF

1. You pass home inspection.
2. Property appraises for what I want it to appraise for.
3. The bank says I can borrow the money

YOU'VE LOST THEM.

If you say "All cash, close in 7 days" Now you have their attention.

Hope this helps.

Terry S.

http://www.Welcome2Arizona.com

It really depends on the market that you're in. If you want to flip in an affluent area, you're going to need a LOT of start up capitol. I own an investment house in Scranton, PA, and my initial investment was about $10k.

Good luck, it looks like a great business to be in!

Buy a really cheap, crappy, run-down house then fix it up and sell it for an outrageous amount.

You'd need enough money for the initial purchase and the renovations as well as enough to pay the mortgage until you sell it.

Some people live in the house while they're renovating to save on expenses. Depends on how much renovations are needed.

Can be a financially risky business. Especially if you have no experience and don't know what you're doing and have lots of money to back you up. Not as lucrative now either because days of sub-prime loans and a "hot" real estate market are gone. Haven't you been watching the news about the housing slump and slow sales?

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