subject: 4 Firsthand Tips On How To Flip Houses [print this page] Author: Daniel Mc Grey Author: Daniel Mc Grey
Many want to get their hands intoflipping houses. This form of investment, along with the other hot trends in real estate has proved to be a very profitable business. In fact, the flipping houses industry has managed to maintain its potential despite the financial difficulties that the global economy faces. In this article, we will share with you some tips for a successful business on flipping houses. When starting with flipping houses, be sure to establish a business identity. Make a separate legal entity with which you can transact business with. The number of houses that you sell within a year and your intention of buying a property is taken into consideration by the IRS. Once you are deemed as dealer by the IRS, you may be made liable to pay federal income taxes as high as 35% as well as state income taxes. You can also lose the tax deductions which are available to real estate investors because the profits generated from your transactions may be considered as income from a trade. Second, funding is very important. Some use their own assets as financial resources. Others borrow from hard money lenders so they can compete with other cash buyers for the best bargains. Hard money lenders can lend up to 60% of the market value of a property. Successful investors say that you will not be competitive enough if you rely on traditional loans to close. Traditional loans take some time to close and for sellers, time is money. Try to buy a property at a good discount so that you can sell it for a profit to your potential buyer. Your property should be inspected. Inspection should be done by a skilled individual who can detect structural problems. Keep in mind that the competition of well-discounted homes is tough so you need to have your property inspected as soon as possible. Make sure that the house structurally fine meaning the plumbing, heating, electrical and sewage systems are working properly, submit a contract to purchase together with earnest money to the seller. If the contract is accepted, push paperwork and sent all the requirements needed to a title company for closing. Now its time to flip houses! After the deal is closed, you need to clean up the house as soon as you can. The next step is to put the home on the market with a competitive price. For more tips onflipping houses and on real estate in general, go towww.rehab-real-estate.com.About the Author:
