'House Flipping' advice needed

[Account Closed]

Hey all,

A relative of mine has asked me to advice them on the concept of house flipping -- buying derelict properties, renovating them completely, making them a home, and then selling them for a fantastic profit. I've been told of many success stories.

We are looking to start as soon as possible but I need resources and general tips on finding such properties in the UK of which I can feedback. My task is to find the properties and organise the foundations of the project.

Really appreciate all relevant advice. :)

Regards,

Riyadh

[James Vermillion]

There are many success stories with flipping properties, however I fear you are about to overly simplify the process which is how many inexperienced rehabbers lose a lot of money. There are quite a few things you need to be able to do very well to identify whether a property would even be profitable to flip:

1) You must understand the market you are looking to invest in. Sometimes what looks like a good deal upon first glance is not a deal at all to someone who knows what they are looking for. You need to know how to comp properties in the are you are buying and identify properties that meet your investment criteria.

2) One of the biggest mistakes new rehabbers make is underestimating renovation costs. This happens to almost every new rehabber and will quickly chew up ant profit. You need to know how much common materials cost in your area and what contractors charge for common renovations (plumbing, electric, painting, drywall, etc). It will take some research and networking to figure out the actual costs associated with renovating a property but it is necessary.

As for financing I am not educated on financing options in London, but hopefully someone will chime in with some advise. I understand the desire to get started as soon as possible, I was there not long ago, but make sure you understand the basics and have things in order before you make a major mistake and set yourself back.