The name of the huose flipping game is to buy low and sell high. The whole thing hinges on three things: the market, cash flow and upgrades.
The market
In real estate, the market is a great unknown. At different times house prices rise dramatically and quickly. What happens then tends to be that people sell their smaller houses, make a little money, and move into bigger houses hoping to make even more money. It doesn't always work like that. The market fluctuates and bubbles burst. Sometimes those people that have bought bigger houses can't really afford them, if the market reverses they will quickly find that they owe more than the house is worth. Too many people in this position and the house prices start to fall again.
Of course, this buy/sell--buy/sink cycle is not the only thing that drives the market. It is also dependent on the federal interest rate. This also fluctuates and when it is low people start buying again, at least in theory. If you want to get into the house flipping game, you should learn as much as you can possibly learn about the market in your area. Read books, surf the internet, and get some professional advice.
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