By Mike Baird
Nobody wants to lose money on a real estate investment, but a lot of new house flippers really act like they do. I see these mistakes so often that I sometimes want to take every new flipper I meet, sit them down, and say, “Stop right there! Don’t do that!” Instead of trying to catch every new investor and sit them down for a stern talk before they make those mistakes, though, I thought I’d just share them with you here. It’s a lot more efficient, and you can always refer back here if you find yourself in a difficult situation with one of your flip houses.
Setting the Price Too High
This is the most common mistake I see new investors make. They think, “It’s okay. I’ll just set the price a little bit high and plan to do some negotiating when I get an offer.” The problem is, if you set the price too high on your flips, you’re never going to get an offer. Buyers will assume that you’ve overbuilt the property or that you really don’t understand its actual market value. Then, instead of coming in with a lower offer and negotiating, they’ll just move on to another seller’s home in the area.
Taking Amateur Pictures
Next, if you’re going to save money on a real estate photographer, make sure that you have the equipment and skills to take really good, professional-level pictures yourself. Going cheap on the pictures for your listing and advertisements is a good way to make your property look cheap and dingy.
You want the pictures of your listed flip houses to look immaculate, and you want them to really entice your buyers to come take a look at the property. With better pictures, you get more viewers. With more viewers, you’re going to get more offers, too.
Skip the Marketing Process – Especially Social Media
Those professional-grade pictures you take (or hire someone to take) shouldn’t just go on your listings, though. Yes, listing your flip houses on the MLS will bring them to the attention of some realtors in your area, but that’s all it will do. You want to show the world how gorgeous the houses you flip are, how much you do for your properties, and how valuable they are to your buyers.
If you skip out on marketing, you’re not going to show anyone what great deals they can get on your amazing properties. If, however, you get on Facebook, Twitter, and Instagram, and you show off your gorgeous houses, you’ll start to see more interest in your properties almost immediately. Let people know when they can see your houses, where you invest in real estate, and what you do to your properties. You’ll gain a reputation for being a respectable, trustworthy investor with a lot of integrity, and people will start looking for your properties as they search for their next houses.
Using Cheap Materials for Your Rehabs
Finally, if you really want to kill your chances at selling your properties, go ahead and cut corners with your rehab materials. Cheap rehabs may not show much at first, but they usually have a lot of problems in very little time. You don’t want to get a reputation as the flipper who sells cheap houses at over-priced market values, right?
You want to get a reputation for selling quality flip houses that your buyers love. With that reputation, you’ll be able to build relationships with other real estate professionals and really build your real estate investment business. Now that you know how NOT to sell a flip house, you should know which mistakes to look out for and how to get better at selling your properties. Good luck!