You know it when you see it; a house that has been flipped. A house that was purchased cheaply, completely remodeled and is back on the market. Of course when you see it, it looks great. It has nice stainless steel appliances, new cabinets and remodeled bathrooms. How do you tell if it is a good deal? What should you look for when deciding weather or not to buy it? Here are my suggestions.
Priced in the neighborhood. In order for a flip to be a good deal for you it needs to be priced similarly to the others around it. It can’t be the same size as all the other houses and $50,000 over everything in the neighborhood. It will have a difficult time appraising and it will have a hard time holding that value when you go to sell.It is better for you if they purchased the house way under value and brought it up to the same value as the other houses around it.
Do your research. Find the sellers on the internet. Find out what you can about the company. Search the homes already sold and find out if they have done this in the past. There are lots of contractors trying their hand at flipping a house, so you may not find anything. You might find that they have more Better Business Bureau complaints than you are comfortable with.
Make sure they have pulled the proper building permits. Permits are for your protection. The county or city will come in and make sure they have done the work the properly. For most remodeling projects contractors will need, remodeling, electrical and plumbing permits. Permits are sometimes posted at the house. You should check the county or city website where you can search by address and find the permits and inspections.
Have a home inspection. Flips always look shiny and new, but you need to look at what is underneath. How is the roof? Do they have enough electrical power to support the house? How about the heating system and air conditioning? Don’t skip the home inspection!
Flips can be a great option for the buyer who would like to move into a home with very little to do. To find the right one takes a little extra homework, but is worth the effort.