Flipping houses can be a profitable way to make money, but it’s important to remember that the income from flipping isn’t steady. House flipping is a high-risk venture with great potential, though there are many obstacles to overcome. Investors might have to wait months, or even years, before earning any returns from a single flip.
To reduce these risks and create a more stable income stream, consider owning one or two rental properties alongside 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. While purchasing, renovating, and reselling a property can be done quickly and profitably, it’s important to be prepared for potential challenges or surprises.
For instance, homes under construction are more likely to be targeted by thieves and vandals than other properties, leading to costly damages. Severe weather, burst pipes, and other unexpected events can lead to costly repairs that weren’t accounted for in the original budget. House flippers need to be prepared for both when everything goes right and when unexpected challenges occur.
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 time, no income is generated from the property, as the investor only earns a profit once the house sells.
Some investors are able to flip multiple houses in a year, hoping to generate more frequent and stable income. More commonly, houses are flipped individually, making it difficult to determine when the investment will finally pay off. For this reason, having more than one source of income is vital for house flippers. While real estate offers many opportunities, the most consistent income tends to come from residential rental properties. The process of buying and renovating rental properties is similar to flipping houses, but it has a few key advantages. Investors buying a home to rent out can benefit from hiring a reputable property management company. These companies handle key tasks like securing tenants, rent collection, and property upkeep, freeing investors from the stress of managing rentals.
The experts at Real Property Management Home Together can turn owning St. Augustine Beach rental properties into one of the easiest real estate investments, letting you pursue other aspects of your real estate business. For more information, contact us online or at 904-417-8988. Our goal is to help you make the most of your real estate investments.
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