Realestate.com Blog

How to Flip When Mortgage Rates are Rising

by on June 11, 2013

House flippers need to be aware of how rising mortgage rates could affect their business

Don’t look now, but the long-anticipated secular rise in interest rates may be upon us. A close look at mortgage rates shows a decided uptick as we head into the summer months. That means good news for savers, but bad news for borrowers – and a significant headwind ahead for home prices. Yes, rates are still at the sub-4 percent level. That is, absurdly low by historical standards. But rates are now at the highest point they’ve been for over a year. . . .

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Should I Flip or Should I Rent?

by on May 28, 2013

Real estate investors may wonder which is better, renting or flipping properties, but the answer depends on each investor

If you’ve been reading this column for a while, you know the first commandment of the flippin’ insider: Buy at a discount. This is good advice because it preserves your options: If you can buy at a discount, you not only have every advantage going into a flip, but you’ll have a much easier time renting it out for more than you are paying out in mortgage, interest, maintenance and taxes. It’s simply much easier to create a cash-flow positive property . . .

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To Be a Leader, Keep the Home Court Advantage

by on May 21, 2013

By working locally, real estate flippers have more advantages

If there’s one thing I learned from being a military officer for over 20 years, it’s this: Double-check everything. There is an old military adage that “soldiers do well only those things that the commander checks.” To which I will add a new maxim, apparently from Benjamin Franklin: “It is true that experience is the best teacher, but a fool will learn from no other.” So let’s learn from the experiences of Mr. Justin Pierce, who has generously shared the difficult lessons of his first real estate flip . . .

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What Do Buyers Want? Selling to the Fat Part of the Bell Curve

by on May 14, 2013

Understanding what homebuyers are looking for can help house flippers spend money wisely

Any experienced fly fisherman will tell you: You have to figure out what lures are making the fish bite. Fish are fickle, and their preferences can change from week to week and day to day. Fortunately, the tastes of the average homebuyer are a little more stable. As a real estate investor, you want to deal in the fat part of the bell curve in your market. . . .

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The SWOT Analysis for Real Estate Investors

by on April 30, 2013

A SWOT Analysis measures strengths, weaknesses, opportunities and threats, which are all vital factors for real estate investors to consider

Real estate flippers operate businesses. But as a group, flippers are notoriously undisciplined about doing so. I would wager that outside of low-rent stockbrokers and part-time scented candlestick saleswomen, flippers have the worst market analysis disciplines and the sorriest set of books you’ll ever see. (Fess up in the comments if this is you, or share the tips you’ve developed if it isn’t!) The lack of discipline and organization is particularly damaging when you consider . . .

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Beware Those Traveling Seminars

by on April 16, 2013

Investment clubs may be helpful for property flippers, but real estate investors should be wary of traveling roadshows

I live in South Florida – the closest thing to “ground zero” for the real estate mess. When I drive around, I hear the radio ads all the time: “South Florida is the best place in the country for real estate investors right now! We’re looking for a few good people to make substantial profit on every trade, without using any of your own money!” They then announce a seminar at a local hotel, “free if you sign up now, seating is limited!” Let me tell you – Florida is famous for seminar marketing – and we have no . . .

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Market Still Favors Buyers – What it Means for Flippers

by on April 2, 2013

Find out what low housing inventory can mean for property flippers

For the first time in what seems like half a decade, housing inventories are down. Way down. In fact, according to reporting by the New York Times, citing the National Association of Realtors®, the number of homes currently for sale is the lowest it’s been since 1999. A surge in demand for single-family homes – fueled by rock-bottom interest rates on . . .

Read more about Flipping Properties in a Buyer’s Market

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Avoid Time-Wasters by Prequalifying Your Buyers

by on February 26, 2013

To avoid wasting time and money, house flippers should ask for a preapproval letter from potential buyers

Ask anyone who’s been in real estate for a while. They’ll tell you: They spend a bunch of time working with a buyer. They’ve identified their needs and wants, carted them around town, blown a couple of high-payoff Saturdays, and found a place they like – only to find they can’t qualify for a mortgage. That wastes agents’ time, it wastes your time, and . . .

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It’s Getting Easier to Get a Loan

by on February 12, 2013

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After the mortgage bubble popped, financial institutions around the world were rushing pell-mell into a “risk-off” posture. That portion of institutional investment portfolios devoted to slow and steady money – a portion that was largely made available for home lending – went to Treasuries and other low-risk sovereign debt instead. At one point investors . . .

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