Get Fast Cash with an Oregon Hard Money Loan
If you’ve considered investing in real estate – or spent time listening to investment enthusiasts or watching home improvement shows – house flipping can seem like an easy road to success.
In reality, flipping houses is a popular but demanding investment strategy. Markets like Portland, Oregon, and its surrounding communities offer a wide range of opportunities. From Craftsman homes to bungalows to ranch-style properties, many single-family homes are ideal candidates for renovation and resale. However, savvy investors understand that success requires hard work, practical knowledge, and often a bit of trial and error.
By learning from these common first-time house flipper mistakes, you can better position yourself for a successful investment.
Top Ten Novice House Flipper Mistakes
1. Lack of Financing: You need sufficient capital not only to purchase and renovate your property, but to also cover utilities while making upgrades, holding costs, and a financial cushion for unexpected expenses.
2. Poor Property Choice: A property’s condition, location, and purchase price must all be carefully evaluated when considering a purchase. Thorough research up front can prevent costly mistakes later. (See Creating a Budget below!)
3. Misunderstanding Profit: Successful flippers often follow the 70% rule. Avoid paying more than 70% of a property’s after-repair fair-market value. This helps ensure reasonable return on investment.
4. Lack of a Budget: Creating – and sticking to – a detailed budget is essential. Account for everything, including purchase price, renovation costs, carrying expenses, and projected time on the market.
5. Ignoring Inspections & Permits: Cutting corners on inspections or permits can lead to serious setbacks on a fix-and-flip. Following proper procedures from the start helps avoid delays, fines, or even project shutdowns.
6. Overestimating Abilities: Many house flippers DIY. But there is a time and place for putting skills – or lack of – to the test. Recognize your limits. Hiring professionals for plumbing, electrical, and detail work can save time, money, and stress.
7. Miscalculating time: Experienced house flippers and investors know repairs and renovations take time – and that delays can and will occur. Create a realistic timeline for your house flip project, and build flexibility into your plan.
8. Renovating to Personal Taste: Buyers are attracted to current market trends and neutral design choices – not your personal preferences. Focus on broad appeal by researching trends and consulting real estate professionals for insights on how to renovate for a successful sale.
9. Doing Too Little or Too Much: Small upgrades like updated fixtures and lighting can make a big impact. At the same time, avoid over-renovating beyond what will sell in the neighborhood. Research comps to ensure return on your renovation choices.
10. Overlooking Finishing Touches: Curb appeal and presentation matter when selling a property. Invest in the outside as well as inside of your house flip. Landscaping, staging, and thoughtful finishing details can significantly influence a buyer’s first impression – and your final sale price.
House flipping can be rewarding, but it’s not without its challenges. With careful planning, realistic expectations, and attention to detail, first-time investors can avoid common pitfalls and build a strong foundation for success.
Oregon Private Money Lenders Offer Flexible Fix-and-Flip Financing
With the right financing, you can be on your way to house flipping success. Talk to private money lender Gregory M. Russell about an equity-based loan. We have 30 years of experience as real estate lenders in Oregon, providing fast, convenient hard money loans to fix-and-flip investors. If conventional lenders have said no, your credit history is an issue, or you need fast funding, we’re here to help. Contact us today to learn more about our hard money loan services.