1. All seasoned Arizona real estate investors know that money is made when they buy, not when they sell the flip. Many times, people buy Arizona houses with the idea that they will make all the necessary repairs, put it on the market and resell it for a higher price. They later find out that after all the realtor, title company fees and possibly buyer contribution fees, they end up making nothing at all and possibly losing money on the deal. These people failed to understand that any potential profit they were going to make at the end depended almost entirely on the purchase price of the house. Even though you can run over your budget and make even the best purchase a loss, buying a Phoenix house at the wrong price will always make you lose money. Amateurs in the Phoenix and Scottsdale fix and flip business also don’t realize the amount of costs involved in holding the property. They will have to pay for Arizona vacant property insurance, financing holding costs, renovations costs and other holding costs such as taxes.
2. Get an Arizona home inspection performed. Although it will cost you several hundred dollars, an Arizona home inspection for your flip property will be worth it. It may uncover major things at the home that you may not have seen by yourself at your initial walk through. Issues such as foundation, improperly installed water heaters, air conditioning units, pets, wood rot and other things are a concern for any homeowner even if you have intentions on flipping the house in Phoenix. The inspection period will also allow you to cancel the contract if anything bigger comes up on the inspection.
3. Many people want to repair their newly purchased Phoenix home by themselves. Often times this is a mistake made by do-it-yourself as they believe they can lower their costs and walk away with more money at the end. Although not always the case, most homeowners in Maricopa county don’t have the experience and the expertise to do a great job while controlling renovation costs. Time is also a big issue as the Phoenix, AZ housing market can shift drastically within only a few months and you don’t want to be selling a house in the slow months. This will cause your Phoenix flip house to stay on the market longer which will in turn increase holding costs. Licensed and reputable contractors can do fast work at reasonable costs. This will also allow you to focus on growing your real estate business by possibly searching for new houses to acquire and building business connections. This is how you will get truly wealthy in real estate in the Phoenix, AZ market.
4. When you buy a fix/flip property in Phoenix, Scottsdale, Glendale or any other of the metropolitan cities, your goal to renovate it as quickly as possible and sell it as quickly as possible. That is why often times seasoned investors would rather price the property several percentage points lower than the competition. This will allow them to resell the property much faster while saving lots of holding and financing costs. More often than not, selling your Phoenix, AZ property several months faster will yield you higher profits then if you were to price it higher and wait for offers to come in.
5. Hire an Agent – Do not think that listing your property by yourself is a good idea. Many people are turned off by the idea that Arizona Realtors charge around a 6% commission to list the property. The reality is that if you list the property yourself through sites such as http://www.forsalebyowner.com/search/list/phoenix-arizona,http://www.zillow.com/phoenix-az/ or http://phoenix.craigslist.org/ you will have to wait significantly lower to find a buyer. Once you do find a buyer, that buyer may also have a Realtor working with him. It may come down to you paying a 3% commission to the buyer’s Realtor. If you were to list your phoenix house with a local Realtor, your house will have much better exposure to potential buyers and you can command a higher price as a result.
I hope you will have found this article helpful with some basic thoughts about flipping a house in the Phoenix, Glendale, Scottsdale real estate market. Remember to always do your homework before you purchase a home. If you are looking for Phoenix, Arizona wholesale deals, visit our website for off market investment properties http://www.azrealestatewholesale.com/go/investment-properties/ .