When most people think of real estate investing, the first thing that comes to mind is house flipping. There are even various shows about it on cable television. The world over, people are turned on by purchasing and fixing up a piece of old property for a potentially big payoff. More than ever, more than 6% of homes on the market were from house flipping as of 2016. There is no doubt that the topic of house flipping can be very enticing, which is why we’ve decided to go over it briefly.

What is House Flipping?

Without going into too much detail immediately, house flipping is buying a house or property to fix it up to sell or resell for a profit. Sounds simple, right? Well, it isn’t always THAT simple, as many factors can impact the success of any house-flipping venture, such as budgeting issues, an influx in the crime rate of an up-and-coming neighborhood, and bad timing, among others, are just a few of the risks facing any would-be house flipper.

Popularity

In 2018, house flipping reached an all-time high, with nearly 50,000 properties being flipped as a form of investment. These are the highest rates in house flipping in over 6 years. This, of course, comes with a price as the landscape of house flipping continues to change as it gains popularity. Available properties and rising home costs are two of the biggest factors created by the trend’s growing popularity. The more flipped homes, the fewer properties are available, leaving people to look into areas like suburbs and new-build which begin to dip into the return on investment.

Is it a Good Investment?

Of course the landscape of house flipping isn’t the same as it was six years ago, there are less properties and it is more challenging to make a larger profit, however as they say, “where there’s a will, there’s a way.” We, as investors, must embrace the fact that we, much like the landscape of investing, adapt and change based on the number of transactions taking place over time. As the trend continues to rise, so does the ingenuity and resourcefulness of investors and enthusiasts. While some face the unknown head-on, others find solace in the old-school method of purchasing and using a property to make money as a rental property.

There is no such thing as a bad method of investing unless, of course, you’re just handing money away for no reason. With proper education and dedication, one can turn even the most modest amounts of money into a fortune, and we’ve seen this time and time again throughout our lives, whether on TV, in person, or on TV. This is no different for house flipping. Want to learn more about how Buckeye Northwest Realty can help with your future investments? Contact us today!