Buying a Fixer-Upper? Pros, Cons & Tips

Buying a Fixer-Upper? Pros, Cons & Tips

House Flip Financing is Simple with an Oregon Hard Money Loan

If you have the know-how and are willing to take on the risk, house flipping can be a potentially lucrative way of making a profit in the real estate industry.

House flippers buy properties with the intention to sell for ROI. Investors may purchase homes in hot real estate markets like where rising housing prices assure profit. Other flippers specialize in purchasing fixer-uppers, making upgrades and selling.

Pros: Fixer-uppers cost less and you’ll deal with less competition in otherwise hot housing markets. You have the advantage of customizing the property and having complete control over budget and upgrade choices.

Cons: Despite the best planning, renovations can overrun your budget. Distressed properties inevitably result in unexpected issues and expenses, and you always run the risk of just breaking even or worse when flipping a property.

Despite the con’s, many investors successfully purchase and turn around distressed properties for significant ROI. If you’re prepared for hard work and willing to take some chances, check out these fixer-upper purchase tips.

5 Must-Follow Tips When Buying a Fixer-Upper

Home Inspection: It’s smart to get a home inspection when buying any home. It’s a must-do when buying a fixer-upper. A thorough investigation by a qualified home inspector will inform whether the property you’re considering is worth the investment – and give you a leg up on planning your renovation and budget.

Budget: With inspection in hand, create a pre-purchase estimate of renovation costs including materials and labor to make sure the property is within your budget.

Permits: Many home renovation projects require permits. Research city permit requirements to get an idea of what you’ll need for anticipated property upgrades.

DIY Strategy: A lot of house flippers do renovation work themselves to save on cost. Get specific about which projects can be DIY and which are going to require the help of a contractor.

Financing: Know where the money is coming from! Successful investors have cash in hand for investment property purchases and upgrades. Hard money loans provide great financing options for house flippers.

Offer: Once you’ve done your homework, make a smart offer. Backed up by your inspection, budget and upgrade strategy, don’t overpay, include contingencies and leave room to negotiate a price.

Follow these fixer-upper tips, and you’re on your way to a successful house flip!

Our Oregon Private Money Lenders Understand Investment Strategy

Having financing at the ready is one way to make sure your fixer-upper purchase is on the right track. Our private money loan services offer streamlined financing that is perfectly suited to house flipping. Unlike conventional loans, hard money loans are quick and easy qualify. If you have adequate equity, you can have cash in hand in ten days or less. Paperwork is minimal and your credit and employment history is secondary. Gregory M. Russell is a trusted hard money lender in Oregon State. We have partnered with real estate investors for over three decades, helping them to meet their investment goals. Give us a call at 1-888-477-0444 and we’ll answer any questions. Or complete our simple online loan request form. We help make your fixer-upper purchase a little more stress-free!