Flipping Houses in Your Golden Years
by Candice Sigmon | At Home Helper
January 20th, 2023Could house flipping be the right retirement project for you? If you’re willing to put in the hard work, take risks, and accept the inevitable challenges that come with house flipping, you could come out on top, as so many other people have done. But before investing your hard-earned money into property flipping, consider these tips from Bonita Springs & Estero Realtors to help you get started.
Find the Ideal PropertyOlder houses can be great opportunities for flipping, but first you need to get the home inspected to ensure that there aren't any major issues. A thorough home inspection will provide you peace of mind before making a purchase.
You also need to know what makes a good opportunity. Look for homes that need:
- Structural improvements
- New kitchen cabinets and countertops
- A fresh coat of paint
- Weatherization treatments for windows
- Updated flooring
- Improved landscaping
If the house’s kitchen is older, you may need to replace the appliances with new models and install an under cabinet range hood to help keep the new kitchen clean. If the kitchen has room, you may also want to consider building an island to provide more functional use.
Ideally, you’ll find a property that needs most of these renovations. By enhancing the quality of these elements, you can reap multiple benefits from your flip, including lowering your purchase cost and increasing resale value. Renovations can be costly, but investing strategically can pay off in the end. However, while the home is undergoing renovations, use construction takeoff software to estimate project costs and anticipate complications. It's the same software that contractors use, so you know you can trust the data it provides.
Get the Right MortgageAs a senior, you may have already spent years paying off mortgages, which means you have equity for a loan. Another potential solution is to finance using money from your retirement accounts, such as your 401(k). Selling your home can be an excellent way to make money — but by financing with these sources, you can keep ownership of your current home while obtaining that all-important mortgage.
The 70% rule assists home flippers in determining the maximum price payable for an investment property, according to Rocket Mortgage. Generally, you should spend no more than 70% of the home's after-repair worth, minus renovation costs.
Sell and Market Your HomeWhen selling your home, you may think it is in your best interest to save a little money and list it yourself. However, working with Realtors like those at Bonita Springs & Estero Realtors can help you sell your property faster and at a higher price point. Real estate professionals often have connections with other real estate agents and can negotiate on your behalf to get a better price for your property.
Your realtor can help you market and list your home, but you can take additional steps as well. For example, using social media is a great way to spread the word about your properties, and you can also create your own Facebook ads. Facebook lets you set goals, define specific target audiences, and create multiple ads, so use these tools to run concurrent experiments on every aspect of your campaign.
Be sure to clean and organize the home before taking pictures or offering showings. Cleaner Digs is a great resource for organization strategies and natural cleaning products, so check there before completing your prep work.
Form a BusinessIf you’re going to start a business, LLCs are fast and easy to form And if you’re planning on holding real estate in your LLC, it also provides you with creditor protection. To learn more about starting out and business structures, research how to start a business online.
Once you have your business established, you’ll want to check out payroll software to make sure paying your employees goes smoothly. Issues with payroll can cause headaches for any business owner, so having software that automates repetitive tasks and can create direct deposits makes things easy. Plus, it can calculate the necessary withholdings and track time.