House flipping can be an excellent way to earn income, though it’s crucial to understand that the earnings aren’t always consistent. House flipping is a high-risk venture with great potential, though there are many obstacles to overcome. Investors may be waiting for months, sometimes even years, before they see earnings from one house flip.
To lower these risks and establish a more reliable income, you could add one or two rental properties to complement your flips. Rental properties are considered one of the most dependable investments, providing long-term growth that is seldom matched by stocks or other retirement products.
Is house flipping worth the risk?
Reality television’s focus on house flipping has given many an unrealistic idea of what flipping properties really involves. Although flipping a home for profit can be done swiftly, it’s vital to understand potential difficulties or surprise issues that may arise.
Homes that are under construction are more prone to theft and vandalism than other properties, which can result in significant financial losses. Harsh weather, burst pipes, and other unforeseen events can cause expensive repairs that were not part of the initial budget plan. This is why house flippers must be prepared for successful projects as well as the potential for unexpected problems.
The actual costs of house flipping
Even under the best conditions, house flipping can take many months of work. The time required for flipping a house is significant, from locating a property to securing financing, closing, renovating, and listing it for sale. During this period, the property doesn’t bring in any income since the investor only profits after the sale.
Certain investors can flip several houses a year, with the goal of creating a more consistent income stream. However, in most cases, houses are flipped one at a time, making it challenging to predict when the investment will pay off. That’s why it’s essential for house flippers to have multiple income streams. The real estate sector has various opportunities, with residential rental properties offering the most consistent income stream. Purchasing and renovating rental homes is much like house flipping, but with a few clear benefits. Investors who buy a home to rent out can work with a trusted property management company. They manage responsibilities like finding tenants, collecting rent, and handling maintenance, giving investors more time and less stress.
The team at Real Property Management Heritage can make owning rental properties in Timbergrove one of the simplest investments you’ve ever made, allowing you to focus on other areas of your real estate business. For more information, contact us online or at 832-701-0766. Our goal is to help you make the most of your real estate investments.
Originally Published on June 28, 2020
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