Selling property can be a great way to bring in extra income, especially if you’re skilled at flipping homes. Buying property at a low price and making changes that increase the value is a technique many people have used to bring in extra income.
If you’re interested in doing the same, consider your actions an investment. When you buy a home at a low price point, it might be because it’s a foreclosure or because it has much work that needs to be done. It could be costly to fix up the property, so you need to know that you have the financial backing to do so in addition to supporting any other living arrangements you have.
What are the risks of flipping property?
The most obvious risk is that the repairs you have to make will cost more than the home will be worth once they’re completed. That would mean that you’d be unlikely to get your money back out of the property in a sale, leaving you with losses.
Another possible risk is buying and selling at the wrong time of the year. You may want to buy in the winter, when fewer buyers are looking at the market, but you won’t want to sell then due to the same conundrum. Sales hit a low in January and February, but you can expect them to pick back up over the next few months through July.
Overall, if you’re looking to invest in real estate, make sure you have a firm grasp of your legal rights and responsibilities. Flipping can have a huge payoff, but only if you’re making sure you’re protected.