Many real estate investors just may see a silver lining in the state of the economy. The drop in property values and increase in foreclosures and Real Estate Owned (REO) properties
has presented an opportunity for house flipping. Admittedly, flipping houses
today looks a lot different from the popular trend during the housing boom. Today's investors looking to flip a house look no further than REO -- or bank owned -- homes
for the best bargain.
REO homes have already gone through the foreclosure process and are back on the bank's books waiting to be cleared. Banks are highly motivated to simply get rid of the property and often will take pennies on the dollar of what was actually originally owed. This means huge savings for home buyers and a unique opportunity for investors interested in flipping real estate.
The concept is simple: purchase a bank owned home at a very low cost, remodel or renovate if necessary, then resell the home for considerable profit. Sounds easy enough, but house flipping is serious business. You'll want to get a thorough inspection early and even get a walk-through with a contractor if you're thinking about rehabbing homes
it at all. Add the estimated costs of the repairs to the value of the home. Also, consider the location and neighborhood when sizing up the whole scope of a house flip.
Are you a first-time home buyer and home-improvement lover? The good news for you is you just may qualify for an FHA loan that includes the cost of the home and the cost of repairs all in one loan. House flipping might be a good way for you to make some money. Other types of investors should be prepared to put down 20% or more to obtain a loan.Flipping houses
can be a stressful and long process, but one that can help you make some serious money.