9 Steps to Flipping Houses [Infographic]

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Unless you’ve been living under a real estate rock the past 12-18 months, learning how to flip houses is all the rage now…

With multiple reality television shows like Flip This House and all the others – not to mention all the regional ones (like the one in my backyard “Flipping Boston”) – it seems everyone has flipped for house flipping.

It sometimes kind of seems like a “coo coo for CoCoa puffs”  kind of thing at times…

Even Hollywood Has Flipped for Flipping Houses?

What’s amazing to me is that famous and even not-so-famous-anymore celebrities (hello Vanilla Ice) are now getting into house flipping…proving that Hollywood too it seems has gone flip-crazy.

Add to that constant mentions in USA Today, CNN and US News and World Report, fixing and flipping is becoming more and more popular as the real estate market begins its turnaround.

FlippingAlthough new foreclosures on the whole are on the decline, the fact remains that there are many flip opportunities available and will continue to be as we work through the inventory and climb our way out of the great recession.

House flip deals are still available and this makes for an ideal environment for people want to fix and flip houses – which may have something to do with the current frenzy.

Flipping Houses 101: What Are The Steps to a House Flip?

Back to reality time.

House flipping has never been and will never be…easy. It takes hard work, education and experience to flip houses. And unlike many of those TV shows and news reports, house flipping although popular, is not as simple as it seems.

There are however, some key steps to success – and although there is no way to explain exactly all the little details of how to flip a house in a single post, it can be broken down into the basic steps.

Learn to calculate ALL the expenses on your next flip! Check out the new BiggerPockets Fix and Flip Analysis and Reporting Tool. Try it out for free today!

So to illustrate the steps needed to flip houses, I’ve put together the following infographic, which simplifies what is in practice a complicated process.

We welcome you to use it on your website as well!

House Flipping 101

house flipping infographic

For More Great Articles on Flipping Houses, Check Out:

Image: House Flipping School

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About Author

Michael LaCava is a full time real estate investor, house flipping coach and the President of Hold Em Realty located in Wareham, MA. He runs the website House Flipping School to teach new real estate investors how to flip houses and is the author of "How to Flip a House in 5 Simple Steps".

30 Comments

  1. In my city, Fayetteville, NC, it is hard to flip. I scour the MLS all the time and the price point where the houses are sold only allows you to break even after the repairs. Sucks for me.

    • Hi Shanequa,
      You need to look beyond MLS if that is not working for you. Maybe go to a local REIA meeting and see how other investor’s are finding deals. Create relationship’s through networking.

      Thanks for your comments.

      • Hey Shequena, That was good information he gave because I am from fayetteville Nc. I know investor friends who do rehabs all the time. Sometimes the best deals come from referrals or scouring the neighborhood yourself. I am also a new member of our local fayetteville REIA group you should definitely join the group.

        • Hello Markus,

          Thanks for supporting my comments. Its great your local to Shanequa and invited her to a REIA.
          Thats what it is all about and this is why BP is so great.

          Keep it up!

  2. Mike,

    #1, Every flipper must have an all cash buyer or network of them ready to purchase your house prior to getting involved in the project. It makes it much easier to flip houses when you have your all cash buyers lined up in advance.

    #2, I like to start with 65% ARV – Repairs and work my way up to the MAO. The Seller usually balks at your first offer anyways, so starting at 65% gives you more room to negotiate.

    Otherwise, by using Bigger Pockets to network your deals you should be in good shape.

    • Hi Mark,
      That is true if you are wholesaling for sure but for retailing we leave that up to the listing broker & their marketing to bring us buyer’s.
      I don’t do wholesaling myself but I buy from them

      Your point is correct. The 70% rule I use is to determine the MAO. I never start my offer with that and always start lower for the reason you just mentioned. How sweet it is when it gets accepted
      below the 70%! It happens.

      Thanks for the comments.
      BTW I replied to your comment you left me on my website. Look forward to hearing from you.

    • HI Jerry – Great question

      Exit strategies
      1) Have a lowest sell price(min.profit) that your willing to accept – That can be different for investor’s
      2) Lease option buyer
      3) Turn into a rental

      ARV can drop and rise as I have experienced both – This is why you want to always flip in as quick a time as possible. If you are in a declining market that you can measure then you should run your ARV for at least 6 months out by putting in the measured percentage drop you have calculated. For example if your market value is dropping 1% a month then determine your current ARV and minus 6% from that # to determine your MAO.

      Hope that helps.

      Thanks for the great question!

  3. Mike, great post! I really liked the simplicity in which your presented the infographic organized step by step. I know that each step is a whole world by itself, but the way you presented gives us simple guidelines to get into the journey of flipping properties.

    Thanks,
    Alex

  4. My question is do you have to have the money yourself ? What I mean is I know their is hard money lenders out there but should I have a set of money reserve before I start flipping. Do you know of a book that takes you step by step through the whole process.

  5. What you see on TV and what you read in books might be lot more different in real life.
    Proper education, network, Joint venture partners and safety cushion (Emergency Cash) are helpful tools to do it successfully.

    Not every flip will make you money.But assignment of the contracts can do.

    This article is very well written and information is great.
    Thanks for sharing….again!!!
    To your Success!
    Navtaj Chandhoke

  6. Hi I saw the steps that you recommended for starting real estate investing. I wanted to know should I start my flipping journey by repairing my credit to get loans? Currently I do not own any properties, I am completely new to this, but I want to make this my career!

    • Hi Precious – It is always a good idea to repair your credit for many reasons. I would start on that right away but it should not hold you back in getting started. There is much to do & good for you taking action by asking questions. BP is a great place to get your answers.
      Look forward to hearing about your journey.

  7. Good article but stop encouraging them lol. i’m an electrician and ive made a lot of money flipping houses. My network is all tradesmen who all flip houses. We trade or services between myself, the carpenter, the plumber, and hvac guy. We have been doing this for years after our normal jobs and on weekends and when you dont pay contractors boy do you do well. So stop tellingthese people to scoop up our deals before we get to them and maybe mention how to put offers in way lower when properties are owned by banks and faniemae. They really want to get rid of the properties and usually some are so run down banks dont give loans, so you can really clean up on those.

    • Hello Randall,
      Sounds like you have a good network and team in place. That’s what I love about real estate. Being creative and making it work. Good for you guys. I have partnered with some contractor’s in different capacities and it worked out great.
      Sorry for sharing the wealth. LOL. Where you doing your deal?

  8. I am looking for Real Estate Investor Club in India or UAE or Oman to start collective investment. Could you please help me to find one?

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