Flipping a house can take anywhere from several months to over a year, depending on the condition of the home, local contractor availability, and what projects the house flippers have in mind.
The concept of flipping a house is simple: buy a home for a low price, then sell it at a higher price for a profit. Pulling it off, however, can be a lot more complicated. Flipping a house can come with plenty of financial risks, so selling a home at a profit often requires a combination of luck and, most importantly, proper planning.
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home insurance, is here to walk you through the basics of flipping houses. Read on to learn what a typical timeline for house flipping looks like and what steps the process involves.
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What’s the timeline for house flipping?
There’s no set amount of time that it takes when flipping homes. How long it takes to flip a house will depend on what kind of projects you’re planning for your house flip and how many. The timing of your house flip will also be dependent on the availability of materials you need, and if you’re relying on help from other contractors, what their schedules look like.
It’s also possible that, even with an inspection, you could discover unexpected problems with the house along the way that require you to alter your projects or make additional repairs, and that could extend how long your house flip takes.
Once all your projects are tackled and your flipped house is ready for resale, real estate market conditions will also impact how long it takes your home to sell.
All this said, once you get more experience house flipping, the process can start to move along more quickly.
Generally speaking, here’s what a typical timeline for house flipping could look like:
Getting an offer accepted and closing on a house: 1 to 2 months
House flipping renovations: 1 to 6 months, depending on the nature of the projects
Preparing the house for resale: 1 to 3 months
Closing on the home sale: 1 to 2 months
If the timeline for your house flip stayed on track, that means the process here could take between several months to just over a year to complete.
How to flip a house
Flipping a house can be a rewarding project—and ideally, a profitable one—but pulling it off successfully requires careful planning. Here’s a closer look at the general steps that are involved with a house flip.
Plan a budget
The amount you’ll need to buy a house to flip will vary based on what kinds of resources you have and what the real estate market looks like where you want to flip a house.
There are several ways to determine your house flipping budget, but one popular method is referred to as the 70% rule. Under this rule, an investor shouldn’t spend more than 70% of a home’s projected after-repair value (ARV) minus the cost of repairs made to the home. So, if you expected to sell a home for $250,000 and spent $40,000 on repairs, you wouldn’t want to pay over $135,000 if you followed this rule.
Especially if it’s your first time flipping a house, you should also anticipate the potential for repair costs to exceed what you expected them to be. In some cases, it’s not unusual for a project to exceed projections by as much as two to three times.
As you plan your budget, take your time to explore the financing options that might be available to you. If you’re seeking funding from outside sources, compare interest rates from different types of loan options offered by different lenders to determine what will be best for you.
Find a house to flip and buy it
Once you have the necessary financing in place and a budget to work within, the next step in flipping a house is to find the right fixer-upper to improve.
Take the time to get familiar with potential neighborhoods’ real estate trends so you can get a sense of what market values certain homes tend to have in a particular area. Short sales, foreclosures, or homes sold in auctions in key neighborhoods can be ideal options for house flippers to consider.
Working with a real estate agent who understands your goals and the area can help make navigating this process easier, and they can also provide insight on a home’s resale potential based on what you have in mind. It’s also a good idea to work with contractors to get estimates for potential repairs or renovations.
As you’re looking at potential houses to flip, get an understanding of what your capabilities are. Tackling construction work or other projects yourself can save you a lot of money on a house flip, but only if you’re actually capable of doing so. So, do you have a background in plumbing or carpentry, experience with real estate, or a knack for staging and interior design? Look for homes that will allow you to use the skills you have.
Once you’ve found the right home, it’s time to put in an offer. If it’s been accepted, you can move forward and get to renovating!
Do home renovations and remodels
To maximize your final profit, you’ll want to tackle as much of your own renovating and remodeling as you can.
That said, it’s important to understand where your limitations lie. Don’t hesitate to call in the professionals for specialized work, like updating electrical systems, installing drywall, or repairing plumbing if you don’t have the technical know-how. Mistakes along the way could potentially become safety hazards or cost you more in the long run to fix. Noticeably shoddy work could also turn away homebuyers when you try to sell the home.
When hiring other contractors, seek out quotes ahead of time and verify that they’re properly licensed to do the work you need.
When it comes to choosing what kinds of projects you actually want to take on with a home, it’s a good idea to prioritize those that come with a higher return on investment (ROI). Generally, kitchen and bathroom projects tend to offer some of the highest returns.
Find a real estate agent
Once all your hard work is complete, it’s time for your house to hit the market again!
You do have the option of listing your flipped house for sale on your own, but for a beginning home flipper, working with a realtor who knows the local market can make it easier to determine the right selling price and appeal to the right kinds of buyers.
Put your house on the real estate market
When it comes to listing your home for sale, it’s all about the details. Be sure to emphasize the upgrades you’ve made to the home in your listing, like new roofing, upgraded appliances, or a fully remodeled kitchen—in both words and photos.
Working with a real estate agent can help you nail these listing details to appeal to homebuyers.
Stage the house
Before prospective buyers start touring your newly flipped house, you might want to add a few finishing touches. Many real estate agencies offer staging services, but keep in mind these can come with additional costs.
The whole purpose of staging a house is to allow potential buyers to envision themselves living in the space. Above all else, you’ll want to make sure the home is clean, decluttered, and inviting.
A few strategically placed plants and rugs can go a long way. You don’t necessarily need to fully furnish the home, but a few staple furniture pieces in certain rooms can be effective. Setting the house at a comfortable temperature can help as well.
Close out the sale on your investment property
If you’ve picked the right property to flip and all went according to plan, you can enjoy the thrill of receiving an offer—or many of them—and accept the right one to sell your flipped house at a profit.
What does house flipping mean?
House flipping is a form of real estate investing in which someone aims to buy a home at a low price, make improvements to raise the home value, and then sell it at a higher price to make a profit.
What’s the cost of flipping a house?
How much it will cost to flip a house varies widely based on several factors, like the home’s location, real estate market conditions before and after the flip, and the total cost of renovations and repairs. Average profits from house flipping have waned over the last couple of years, but many house flippers are still able to make money from their house flips with the right investment strategy.
In addition to repair expenses, these are just some of the costs you should anticipate when flipping a house:
Closing costs, before and after the flip
Capital gains tax after you sell the home
The fact that house flipping costs can vary so much makes it important to establish a budget with these costs in mind before buying a house to renovate.
Should you flip a house?
At face value, house flipping sounds pretty simple, and home remodeling shows can definitely reinforce that idea, but it almost always comes with financial risks and the possibility of unexpected obstacles, so it’s essential to make sure you understand this before trying a house flip yourself.
Here’s the bottom line: to pull off a house flip right, you’ll need to have the right financial resources, along with the right set of skills to improve a home (or reputable contractors who can do so for you), and healthy real estate market conditions to increase your odds of selling your flipped house at a higher price.
How to find affordable home insurance
Planning a house flip the right way is an incredibly time-consuming process, especially for beginners. Luckily, with the
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