By Mike Baird
If you’ve been reading about house flipping on the Internet, you’ve no doubt run across at least a few articles telling you not to do it. You’ve heard that the market’s bounced back and there’s no room for flipping houses anymore, or you’ve been told that you can’t flip in a flat market.
With all that “helpful” advice, it is easy to start wondering whether or not this is a good idea after all. You might also be wondering what will happen if you suddenly can’t find any good properties or if the markets in your area take a turn. Honestly, if you do it right, flipping houses is a market-proof business that can work for you no matter what the economy is doing. So, if you’re worried about hitting a rut or what you’ll do if you can’t find any flips for a while, here are my tips for making it through even the worst flipping markets.
Spread Your Net Wider
When you get started, it’s a good idea to flip close to home. You’re more familiar with the market and the surrounding area, and you won’t have a long commute as you learn what you do and don’t need to be present for on-site.
However, as you start to gain some experience flipping houses, you shouldn’t be afraid to spread your net a little wider and search in surrounding areas. This way, as you gain a reputation and as investors and lenders start to have more faith in you, you’ll have more markets to choose from. You can start flipping more houses simultaneously, and you won’t have to worry about your current market drying up on you. In fact, as you get more comfortable, you can even start looking at markets in other states.
Make Friends with Wholesalers
Whether you meet them in real estate investment club meetings and networking events, or you find them online, get to know at least a couple of real estate wholesalers in your area. After you buy one contract from a wholesaler and let them know that you’re interested in more, they’re going to remember you. After a couple of successful deals, they’ll start calling you whenever they have a contract on a property that you might be interested in.
Save for a Rainy Day
While you’re doing everything in your power to build your reputation, collect leads, and flip more houses, don’t forget to put away some money in savings and other investments. Fix-and-hold properties can be a particularly good investment to bring in some passive income even if you hit a dry spell with flipping. If you invest in a couple of steady fix-and-hold properties and hire a good property management company, you’ll see positive income that you can invest in flips or use to live off of when you aren’t flipping any houses.
With these three tips, you should have the tools you need to keep your finances in the black, even when you face a tough flipping market. Remember to stay flexible and open to new markets, and don’t be afraid to diversify your investments. Getting financial advice from somebody like Greg doesn’t hurt, either. Whatever you do, keep your head up, stay calm, and keep looking for the next great flip deal. They’re always out there and, if you follow my advice, you can sustain your business even when you aren’t finding as many deals as you want.