| So you see Calgary's oil, tourism and agriculture as a | | | | would recommend doing the easier jobs yourself. This |
| great foundation for many, many years to come. Your | | | | saves a lot of money and costs you little time. What |
| right. Calgary has very strong fundamentals so buying | | | | jobs? Putting on socket covers, painting, things like that. |
| and flipping a home or 30 here is great idea. Calgary | | | | If you are not handy then you have to budget labor. It |
| homes are a great investment in the short or even | | | | will make things harder but it will force you to find the |
| long term. If you buy Calgary your buying right. But | | | | best deals in your area. Calgary has a lot of |
| don't forget readers this article can be useful for | | | | contractors and handymen. There will be no shortage |
| anyone in any city as long as you keep your eyes on | | | | for all you flipping a home in Calgary. |
| your basket of eggs so to speak. | | | | So know the nuts and bolts. Where do I start? Get |
| So your looking to get into flipping or as it is known in | | | | pre-approved by the bank. Know your limit and only |
| the United States, rehabbing to some. We will call it | | | | use 90% max of it. Leave some cushion for a LOC |
| flipping to keep things simple. I have over 9 years of | | | | (Line of Credit). Ask your mortgage broker, bank or |
| experience flipping homes in Calgary. From doing a lot | | | | lender about a nice cushiony Calgary LOC. You will |
| of the work myself to hiring people to do it for me. So | | | | need this money, trust me. |
| lets take a look at what flipping a home really is. | | | | Next get a GREAT Realtor. The key word is great. I |
| Flipping means many things to many people. I define it | | | | know you want to save the commissions but trust me |
| as buying a home for the sole purpose of making a | | | | again, they are a valuable ally in this business. First, they |
| quick profit, within 3-6 months. I hope this fits most | | | | will find you homes, drive you around and the really |
| peoples definition of it. I will solely focus on the part of | | | | good ones will even break down the numbers for you. |
| flipping that includes renovating. During the Calgary | | | | And you don't pay them a cent. When you sell they |
| boom flipping meant holding the home for a few hours | | | | will advertise for you, do Open Houses and in general |
| and making 20k. | | | | sell the home way faster then you ever could yourself. |
| Now here is the golden rule. You make ALL your | | | | I have tried to sell homes on my own in the past and it |
| money when you buy that Calgary home not when | | | | is not worth it. The wasted time, headache and in the |
| you sell. What do I mean by this? Well, if you buy a | | | | end less money for the same home. But I cannot |
| home at a sufficient discount, if you bought wisely then | | | | stress this enough, they have to be on top of their |
| all things being equal when you sell you are guaranteed | | | | game. No part-time Realtors or ones that don't do |
| to make a profit. Does that make sense Calgary | | | | much, or have not clue about investing. They need to |
| flippers? | | | | be great at their profession. How will you find them? |
| How does this affect you? Let's use a scenario. You | | | | Have them buy you a coffee and interview many. |
| buy a Calgary home for $100,000. The homes in the | | | | Ask a lot of questions about flipping, are they Full-time, |
| area, same square footage, same general look and | | | | etc. This will take time and might be one of the hardest |
| layout sell for $115,000. Now your home needs a lot of | | | | things to do. But if you do it right and take your time, |
| work and the ones selling for $115,000 are in pretty | | | | the Realtor you choose will pay of dividends for you. |
| good shape. You think you can put in $5,000 and your | | | | What should my Calgary Realtor look for? Well, there |
| Realtor fees are $5,000. So you will walk away with a | | | | is a simple rule. Find the cheapest home in the most |
| cool $5000 in your pocket. Smart right? | | | | expensive neighborhood. Also make sure there is |
| Well now it takes you 4 months to fix. There was an | | | | something wrong with it that you can fix. A house no |
| unknown plumbing issue and on top of it all the market | | | | one wants is a gem waiting to be picked up and make |
| fluctuated like it does, and houses dropped 1% (doesn't | | | | beautiful again. Also make sure the seller is motivated. |
| sound like much but it is). So lets add up about $3,000 | | | | You will know this by how long the house is on the |
| in mortgage and taxes, another $1,000 in extra | | | | market and how they negotiate with you. Some even |
| plumbing repairs, and let's drop the price of the homes | | | | tell you. Do your own due-diligence and talk to the |
| in the area by $1,000. So now if you sell your home for | | | | neighbors on either side. Get some info from them. |
| the average price you will make $0 dollars in profit not | | | | Then if the all is right, send out an offer. |
| to mention your time invested. This is a terrible deal. So | | | | Next, once your Realtor has found you the home. |
| make your money when you buy a home. | | | | Remember you made your money already, cause you |
| Flipping is about numbers. No emotions at all. Make a | | | | made it when you bought the home. Make your |
| spreadsheet. Follow the budget. I cannot stress this | | | | budget. I assume when you bought you bought a |
| enough. Follow the budget. A lot of shows on TV say | | | | home that was not over your head. What I mean by |
| this. But what they do not say is that you have to | | | | that is the foundation does not need to be replaced or |
| make your budget realistic. Yeah you might have a | | | | the entire roof removed. Do work in your scope. You |
| $20,000 dollar budget on a $400,000 dollar home. | | | | would be shocked by how a little paint, some new |
| Again might sound like a lot. When you add in carry | | | | carpet and some staging (will get into that in another |
| costs, repairs, labor, your time and unknown costs. It is | | | | article) can make a home look like new. Again, and |
| a small amount. But on the flip side if your home you | | | | again keep to your budget. Do not forget monthly |
| bought was $40,000 then $20,000 is a huge budget. | | | | utilities, mortgage, taxes, labor, materials, Realtor fees, |
| Please remember to be realistic with your budget and | | | | and a 5-10% cushion for any unexpected issues. |
| then stick to it as if your life was on the line, which it | | | | Finally, time line. Do not hold your houses longer then 6 |
| might be. | | | | months. Unless your doing a major flip where your |
| How will you make your budget? Use free estimates | | | | adding a second story or something. I say this cause |
| when you first start. Get in a lot of people to estimate | | | | the market could change dramatically in more then 6 |
| the work. Find some good flooring/tile/cabinet/paint | | | | months, many times earlier then that. And not always |
| lumber/etc stores and get prices. How much are 35 | | | | in your favor. Most flips should be in and out, like a ninja. |
| 2x4 studs? How much is 400 square feet of quality | | | | You get into the area, clean up the house, make your |
| Berber carpet? This will come easier and easier as | | | | profit and leave. Budget time realistically. In the |
| you get into it. When you get good, you will walk into a | | | | beginning if you think painting the interior will take 6 |
| home and make a very accurate estimate in minutes. | | | | hours, triple that number. That is probably more realistic. |
| Now labor. Do you do the work yourself? Well it | | | | Again once you get good you will know exactly. But |
| matters on 2 things. Are you handy? And do you have | | | | again get in, 3-6 months later get out. I mean sold and |
| the budget for laborers/contractors? If your handy I | | | | money is in your back on month 6. |