Is house flipping still profitable these days?
Answer:
I do house flipping for a living..Yes it is still profitable..But buyer beware..You have to know your market! In other words, people end up paying too much and that's where the problems start..Do your due diligence...The main problem with amature flippers is the carrying costs! They get a loan, spend money to fix it up and sit on it for months..That's what kills you, the carrying costs..So, where you make your money is when you buy, not when you sell..You also must have some capital..You can't just buy everything on credit..Interest rates will eat up your profits too...In the market i am in, home prices are pretty low, so my profits are also low, we make an average of $30k-40k per flip...My advise to you is to find a property that is at least 50% below retail, that will give you plenty of margin to make a profit...That way you can sell it cheap and avoid carrying costs, which will kill you in the end..Best of luck and email me if you have any questions.
I'm thinking you might need to find a new strategy to make a quick buck. You can buy homes at this time under market and find sellers now that are pretty desperate to dump their properties, but you have to be smart about it. AND . even if you find a good value, there is NO guaranty you can turn around and resell it. If you are looking for a deal, the best way would be to find someone who wants to sell to you before they actually list it and take the 6% discount on the price they may have paid to a realtor. I'm sure you or someone who know knows someone that REALLY wants to sell their home!
That said, in a flat market like today (although I have no idea about the appreciation in your current city), "flipping" is not the way to go. To make "flipping" a good strategy, you need to 1) buy below market . and . 2) add value . in an appreciating market. A better strategy for today would be to stay liquid to be able to take advantage of any bargains and hold them until it makes more sense to sell when the market perks back up.
house flipping is really risky these days. I know of a couple of people who thought they would make a killing, and wound up coming close to losing everything. Procede with caution. It's really pretty hard to just flip these days because in most cases, the market is still not going to let a "bargain" slip through the cracks. Especially the lower priced homes..people are still able to buy and afford those. It's the mid to higher priced homes that buyers are starting to be very selective about. Be carefule, my friend
If you buy it really really really cheap you can flip it really cheap, but you would have to be in a really distressed area, most are not that distessed yet.
No in Chattanooga TN
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