This series discusses the many crucial aspects of any successful Real Estate Flip. For those new to the term “Flip” it means to purchase a property, enhance its value through renovations, and sell it for a profit as quickly as possible.

Maximizing Profit when Flipping a Property

This part of the series is discussing the acquiring of potentially profitable real estate. I personally feel this is the most important part of the whole process, as many real estate owners have become attached to their property and wont let it go for the price you need it to become profitable. For this reason, we preferably look for Power of Sale properties. These are financial distressed properties that the bank has taken possession of and putting up for sale usually for what ever is owing on the mortgage. Keep in mind they do have a fiduciary obligation to sell it for as much as they possibly can, but this does not mean you cannot buy it for far below market value.

flipping-the-house

Competition on Power of Sale can be fierce, with the ever growing population of professional “flippers” this makes the purchase very strategic step. We have a proven formula that we will share with you. Keep in mind that there are always exceptions to the rule but typically we see two major Power of Sale Scenario’s

  1. The Bank lists far below market value, looking for bid war and will usually give you a date to submit your offers
  2. The Bank lists at Market Value and will accept offers Immediately

We handle each scenario differently, but the rule of thumb is;

 

Keeping in mind the bank has deep pockets and can wait 30 days for a significantly higher price, why it makes it VERY important to have the strongest offer at the right price.

How we dictate what the right price is, we will dig deeper in part 2 of the series “Art of the Flip”