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What Are The Advantages Of Buying A Flipped House?
House flipping-the process of buying and reselling houses for a profit-seems to benefit
the seller while taking advantage of other peoples' misfortunes, since homes in foreclosure or REO (real estate owned by the lender) status are currently the most common candidates for flip homes. House flippers purchase homes below market value and turn them around for a quick profit, often after making only minimal improvements to the property.Flip home investors are notorious for bare-bones improvements and cutting corners by making cheap cosmetic renovations instead of more essential but costlier structural improvements, in order boost the seller's profit margin.
So how can purchasing a flip home benefit the buyer? With some solid research and a few protective measures, a flip home can be a good investment for the buyer while still making the seller a profit.
Inspections are Essential: Any home you are considering purchasing should have a professional inspection, even if the home has been recently appraised. Appraisals do not consider structural issues that are often overlooked in flip home renovations. An inspection will reveal any structural issues in the home, including faults in systems such as HVAC, electric, water heaters, plumbing, attics, basements, roofing, foundations, and problems such as mold, termites, or other infestations.
Reasons to Buy a Flip House: Not all flip homes are fixer-uppers, and not all fixer-uppers cut corners during renovations. If a flip home passes an inspection, you may have discovered a good home for a reasonable price. You can further protect yourself by purchasing homes from reputable contractors who regularly flip homes or from home buying companies who specialize in buying and selling houses. Licensed contractors, builders, and home buying companies can be researched through the Better Business Bureau, by reading their websites, and visiting their offices in person.
Another reason to buy a flip home from a reputable seller is that these homes are usually newly renovated. Sellers tend to renovate high-use areas such as kitchens and bathrooms first, because modernizing these areas is most attractive to potential buyers. Flip homes will often come with new floors or carpeting and fresh paint, so flip homes are likely to be move-in ready.
Finally, the owners of flip homes are motivated sellers. Their goal is to sell the house for a profit in as little time as possible. Since a flipper purchased the home below market value, it may be more likely to sell for a competitive price than a conventional home for sale.
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