If you had a dollar for every fix and flip reality show on TV, you wouldn’t need to save money for a down payment on a mortgage- you could buy a house outright! This trendy industry has been popularized by shows that feature gorgeous redesigns, high profit margins, and quick turnarounds. Flipping houses can make you a lot of money, but you need to understand what you’re getting into — and that means you can’t rely on HGTV reruns. Here’s a quick behind-the-scenes look at the reality of house flipping that you won’t see on TV.
Harder Than It Looks
Unfortunately, it takes a bit longer than a 30-minute TV episode to complete a successful fix and flip project. Reality TV often breezes by the less glamorous parts of the process, like finding the right property, planning renovations, and working with a lender to purchase the property. Then you have to coordinate with contractors to get the renovations done – and this is easier said than done if you don’t already have connections in the industry that you trust. Plus, you might face delays and unexpected costs that need to be accounted for.
You also have to be ready for unexpected issues that may arise at the worst possible time. When these issues crop up on reality TV, it always looks like the hosts were blindsided – but these are faked reactions to create drama. Going into a fix and flip project with no backup plan can be a recipe for disaster, and experienced real estate professionals will always be prepared for the unknown. Always have a carefully planned budget with a ‘disaster fund’ to cover these kinds of expenses, and carefully research your property before you begin renovating!
It always seems like the fix and flip homes on TV have buyers lining up to submit above-market offers. Depending on the location and timing of your fix and flip project, this kind of response is possible – but if the home doesn’t sell right away, you need to be prepared for the increased costs of property taxes, interest on your loan, and upkeep costs. The faster you sell the property, the better off you will be, since properties that linger on the market begin to drop in value. To avoid delays, you will need a good real estate agent.
Despite the fact that reality TV often brushes over the more challenging aspects of the industry, house flipping is still a great option to achieve financial independence. For more guidance, contact us! We will help you achieve your homeownership dreams.