How does ‘flipping a property’ work?
It’s a three-step process. It begins with you finding and buying the right property. It can be a house or a flat and once you’ve made your purchase, it’s a matter of improving it and then selling it on again. Sounds simple, right? Well, there is plenty that can stand in the way of making your investment dreams come true when it comes to flipping the odds to your favour.
To be considered a successful investment, you’ll need to generate a positive return (ROI). It is this end return, along with all the work involved, that will determine if flipping is the right type of investment for you, compared to the returns that other investment opportunities offer.
Alternative investment ideas to property
Your return on investment for house flipping can be worked out using this simple formula:
FINAL SELLING PRICE – COST OF PURCHASE – COSTS OF MATERIALS & LABOUR = Profit
Of course, it’s not really that simple. Let’s take a look at what’s involved in each step of the journey.