Business

House Flipping: What Is It, and How Can You Turn a Profit with It?

House Flipping

What Is House Flipping?

House flipping, otherwise known as property development or property trading, is a process which homeowners undertake to turn a profit in the buying and selling of homes, or to climb the property ladder with relative speed. A property flipper purchases a given property, invests in its renovation and refurbishment, and then sells the property for its inflated value. The inflation of value can appear either as a return on investment from the renovations, or from upticks in the property market inflating house prices regionally – but the majority of house-flippers maximise their gains through refurbishment and redecoration.

The House-Flipping Process

Every change made to a house in order to ‘flip’ it must increase the home’s overall value. There are some methods which are more profitable than others; here we will go room-by-room to discuss the ways in which property developers create their profit.

Living Room

One of the key tenets to successful property trading is to impart character onto the home during renovation, but not to force taste on new buyers. As such, it is important not to take any risks when renovating living spaces; keep colours neutral where possible, though a feature wall can increase interest. Hardwood floors are of particular interest to new buyers, and could be a good investment instead of a carpet solution.

Kitchen

The kitchen, while not the most-utilised room in a given home on average, can often be the dealbreaker or dealmaker for a prospective buyer, and its renovation represents a significant uptick in house price: between 3 and 10%, depending on the previous value of the home. New kitchen units and a new lick of paint can make all the difference – but if your home is worth more than £200,000 you may want to consider consolidating that renovation with investment in appliances, such as a convection oven.

Bathroom

The biggest increase in home value can be found in the construction of a second bathroom – but many developers do not have the budget for this. Instead, marginal gains can be made for next-to-no upfront cost; for the cost of new tiles, floor tile adhesive and grout, coupled with some hours of personal labour, you can achieve remarkable results redecorating the bathroom for a newer, shinier look.

Bedrooms

Bedrooms are of the easiest rooms to renovate in preparation for a sale, though there is not much to be had by way of profit past introducing a new en-suite bathroom. Fitted wardrobes are a consideration you could make, but with your money and energy focused on other, more lucrative parts of the house, a simple redecoration with new paint on the walls and a new carpet underfoot will suffice.

In Conclusion

Whether as part of a career or lifestyle, or simply a way to take your household up the property ladder a couple of rungs, property development is not for everyone. It represents significant investment and effort, and remains at the whims of an occasionally volatile housing market. However, when done right, house flippers can make life-changing money.

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