E Property Flipping Or Rental?

Therefore, if you are an investor engaged in this business you are likely to seek out for the most efficient way to sell your newly acquired property after enhancing its market value through home improvement. This is because the quicker you sell it, the quicker you receive finances to target the next property. Frequency is the key in this case as this dictates the level of income you make at the end of the year. As seen in the example cited above, it should ideally take less than a year to turn your profits. This is probably why most home-flips are concentrated in busy business regions as these tend to find customers quicker.

Investors targeting these types of investments do so to capitalize on the highly discounted prices that out-of-condition properties trade at. This helps them to increase their profit margins on the total amount invested including renovation costs. Investors can also boost the value of their renovated homes by adding modern features including smart home technology. Controlling reconditioning and renovation costs can also help to improve the return on investment.

Or maybe rentals are a better choice?

Investing in real estate is often seen as a perfect way to save for retirement due to the predictability of the periodic payments.

Unlike in house-flipping, investors know beforehand what they can expect to receive in rental payments for the foreseeable future. This type of investments requires roughly the same amount of capital as in the case of house-flipping. There is the initial amount required to buy the house, and another amount required to renovate it to make it more appealing to potential customers looking to rent property.

However, when it comes to receiving the income, as compared to the one-time lump sum for the fix and flip investors, the payments are gradual and can increase with time depending on house prices. In this case, investors can make more from the investment than is the case of flipping the house.

In addition, they can also invest in other properties by taking a mortgage, which can be serviced with the rental payments received from the current property.

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Disclosure: The material appearing on this article is based on data and information from sources I believe to be accurate and reliable. However, the material is not guaranteed as to accuracy nor does ...

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