EP 29 - Flipping Houses - a podcast by Brian Cook And Kindra Cox

On Episode 29 of The Brian and Kindra show, they discussed flipping houses. It takes a lot to flip a house and the ratio at which houses can be flipped is small. Roughly per 100 houses on the market, one is flippable. 

The goal of flipping houses is to see a large return on the final product. Flipping houses is a team project involving contractors, bankers, insurance agents, planners. You can flip a house on your own, but there is more risk. Most importantly, always expect the unexpected!  You never know if you will find termites, mold, etc. Expect these issues not just for time management, but for money management as well.

The goal is to flip a house quickly to get it on the market helping to keep your profit margin more protected.  A lot of investors can flip a house in 30 days, but they have more availability of flippable homes in their market. In the Woodward area if you’re looking for a house to flip, you may find the house to be in a condition that takes longer to rehab and resell. Attempting to keep small window of time to flip a house in Woodward is hard because contractors are busy and there aren’t a lot of them. Rather than having multiple contractors available like you would in a larger city, our local contractors tend to be very busy and don’t have as much availability. 

There are too many factors of what can go into flipping a house to put a definite cost number on it. When flipping a house you have to think like an investor, not a homeowner. When flipping a house, you need a back-up plan. If the house doesn’t sell in six months, you may find that converting the flip house to a rental property is a wiser option. This will take you from a six-month investment to a 15-year investment as a landlord. 

Funding for flipping houses has many options. Banks could loan you 7-8% interest money for short-term loans. People have also refinanced their primary residence, pulling out a second line of credit. The most important thing is to be educated. If you’re going to buy a flip house, Brian and Kindra can write a contract that gives you a ten day period to do inspections and verify that you are comfortable facing the issues you may encounter in your rehab. They have good connections and contractors who will meet you at the house and help give you the worst case scenario to plan for. 

Because of the condition of ‘flippable options’ here in the Woodward area, the properties may not be good candidates for a lot of the finance options just mentioned. Most houses that people purchase locally for flips need to be cash or an in-house bank loan. If you choose to obtain a loan, you need to have a good, established relationship with your lender. 

Brian and Kindra hope these tips have been helpful to you. As always, if you have any questions or need help, please feel free to reach out to your local real estate professional.

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