Ahhh, the flipâ€¦Youâ€™ve all heard of them, some of you may have seen them on television; a charming, attractive team of designers and builders snatch up a home for next to nothing, buys some kitchy-cute panelling at a vintage shop around the corner, refinishes a claw-foot tub, and voila!Â A cool hundred Gâ€™s in their pockets on the resale.Â Itâ€™s that easy!
Main Renovations has been flipping real estate for over a decade; from humble beginnings in Quebecâ€™s Eastern Townships to the upscale neighborhoods of Ottawa, we have torn down, ripped up and refinished some of the oldest, most dilapidated homes you would ever want to imagine.Â Â What has this experience taught us?Â Well, for starters, what you see on television couldnâ€™t be farther from the truth and more often than not, we see lovely well-intentioned people such as yourselves get roped in to the â€˜fast-cashâ€™ appeal of flipping their own home, only to get badly burned by the harsh realities of unforeseen site conditions, long, hard, back-breaking hours, and the mounting costs of tradespeople and interest charges.
If you are considering a flip, there are a few things you should consider before putting pen to paper.
1. What is the highest price a home in your area has sold for in the past four months and how does that compare to what you are buying?
Right off the top, you have to account for lawyersâ€™ fees, loan interest, agency fees and insurance and taxes.Â These figures are non-negotiable and will easily eat into profits that you havenâ€™t even made yet.
2. How much of this work can you do yourself?Â No, I mean really do yourself.
If you canâ€™t do as good of a job as a skilled tradesperson can, then you shouldnâ€™t be doing it; not only can it be very dangerous (and sometimes illegal!) , a homebuyer will not pay top dollar for work that looks like his buddies did for him in exchange for a case of beer.Â A flipped house is a representation of your work â€“ if you have cut corners and patched things together it will show.Â Anytime you catch yourself saying, â€œah, no one will notice thatâ€, youâ€™re wrong.Â They will.
3. How much of your personal time are you prepared give up for this?
The whole point of the flip is to make a profit, (or, in some cases, not lose your shirt).Â Of course, the catch is that in order to make the money you have to put in the time.Â A LOT of time.Â However long you think this will take you, double it.Â And factor your weekends and numerous evenings into that.Â Even if you have been at your â€˜day-jobâ€™, even if youâ€™ve got a great summer cottage youâ€™d like to visit.
But itâ€™s not all bad.Â We love, love, love flipping homes, even when the going gets tough and even when the nights are long.Â For us there is no greater satisfaction than revitalising a beautiful building and knowing that someone will love it and care for it now that we have breathed new life into it.Â We will talk more about the numerous aspects of the flip in upcoming articles â€“everything from site selection to choice of finishes, and of course some great pics too!