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Flipping houses seems like it can be a real money-maker! There are dozens of TV shows about seemingly normal people with just the right amount of know-how to make flipping houses their full-time business. But did you ever wonder how they find houses to flip? It seems like they just randomly happen upon the perfect home at just the right price, and then everything falls into place from there.
There is way more to flipping houses then just randomly locating a house to turn around for a profit. If you want to learn more about how to find houses to flip, then check out the highlights below to get you started on the correct path. Also, if you’re already committed to your first fix and flip, be sure to run the numbers through this hard money calculator to ensure that the project is likely to be profitable.
WORK WITH A REALTOR
If you aren’t from around these parts, then it’s essential that you work directly with someone who knows the local real estate market. A large part about successfully flipping homes comes from all of the upfront research you’re going to do, and that includes selecting the right professionals to work with. Realtors will help you find houses to flip, as well as set a realistic selling price when it comes time to actually make a profit on the property.
Working with a realtor will cut down on wasted time initially in the project. Select an agent that has experience in REO, or Real Estate Owned, because this can be an excellent source of homes to select from, and absolutely make sure that they have access to the MLS.
SEARCH THE MLS
The Multiple Listing Service (MLS) is a huge database that is maintained by real estate brokers. This is a fast, efficient way to start looking at available properties to flip. This is literally a wealth of information at your fingertips, including property characteristics and statistics.
Check out the different kinds of properties and see what might work for your particular financial situation (and if you’re looking for probate properties, more tips can be found here).
Foreclosure and estate auctions are perfect opportunities to find investment properties way lower than their estimated value. The downside is that a bidding war may ensure. One big catch here is that you likely will have to have cash on hand to make the purchase, so unless you have capital set aside for auctions, this may not be a solution for you.
If you do have the money to make this work, however, it’s a great way to find houses to flip. Auctions are typically posted weeks in advance, giving you enough time to research the property and make an informed decision. The more knowledge you have before the auction begins, the better, because if a bidding war begins, then you’ll already know what the maximum amount you should put down is before you start eating away at potential profits.
CHECK THE CLASSIFIEDS
While it’s not the most popular way to sell a house, people still do try and sell homes themselves and will minimally advertise through classifieds. Don’t expect to find the golden opportunity here, but you may be surprised at what you’ll find when you begin flipping through a print newspaper or scanning an online edition.
JOIN REAL ESTATE INVESTMENT FORUMS AND GROUPS
There are many different groups online that you can easily join for advice and potential leads for locating houses to flip. Some can be very localized, which is perfect if you’re trying to ascertain if there are homes in certain neighborhoods for you to flip. Something like Biggerpockets.com can also help feed you information about real estate investment properties.
Facebook and LinkedIn have tons of groups for you to join that can help get you pointed in the right direction. Networking and making the right contacts is just as important when you’re looking for houses to flip as it is with everything else in life.
CONNECT WITH A WHOLESALER
What is a wholesaler and how are they different from what you’re trying to do? Basically, a wholesaler is a person who will find the properties and get them under contract, but they will find a buyer to actually flip the house. You would become the middleman, paying a fee to the wholesaler, and flip the house. It can eat into your profits, but wholesalers are very motivated and can sometimes get to properties before others due to their own connections.
If you’re planning a fix and flip, use the free New Silver Deal Analyzer.