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Report: How Much Money Do House Flippers Make?

How Smart Real Estate Investors are Flipping Houses in 2019.

How much money do house flippers make? According to RealtyTrac's U.S. Home Flipping Report, investors made an average gross profit of $63,000 per flip last quarter. In other words, on average, houses sold for $63,000 more than they were purchased for.

With the United States real estate market heating up, many people are getting into flipping houses. Cities with the highest number of flips include Detroit, Los Angeles, Memphis, and Miami. Cities with the highest profit on flips include St. Louis, Jacksonville, and Chicago, according to the report.

Can a Soccer Mom Turn a Profit Flipping Houses? Click PLAY

How to Find Discount Properties

The first step to flipping a house is finding a discount property. The goal is to buy low and sell high and keep repair costs to a minimum. Fortunately you can find bargain properties in many different areas of the U.S.

For example, if you live near the Tampa, Florida area, you will find bank-owned houses listed in the $10,000-$40,000 range.

Example: Here is a look inside a bank owned home purchased at a big discount. After upgrades the owners made a healthy profit.
Click Here for a Free DVD That Shows You How to Flip Houses

Many house rehabbers find undervalued houses by looking for foreclosures/bank owned properties - also called "REO" houses. Banks have carrying costs on any house in their inventory. Carrying costs include insurnace, taxes, and property maintenance. As a result, banks are often very motivated to get rid of their housing inventory - even if they have to sell it at a discount.

HUD houses, which are foreclosed homes with an FHA backed mortgage, are also a source of bargain properties. HUD publishes all its houses on a website which makes it easy for investors to look for potential deals.

How to Get Funding for Your Flip If you do not have a lot of start up capital to work with, you can still get into flipping houses. You can access to funding to flip houses so that you use only a fraction of your own money.

One way to use other people's money to flip houses is to get a "Hard Money Loan". A "Hard Money Lender" is an individual, or a group of wealthy individuals, who lend money for the purpose of rehabbing houses. It is a short term loan you repay monthly with the balance paid in full when the house is sold.

Getting a hard money loan is easier than getting a loan from a bank. There is less paperwork and your credit history is not as big of a factor. Often you can receive an approval in 48 to 72 hours and have the funds in as little as 7 days. Some Hard Money Lenders provide funding without checking your income or your credit report.

Using hard money will reduce your overall profit because you pay interest and points on the loan. However, it is a good strategy to use if you do not have funds set aside - or prefer not to put your own money at risk.

Example: This home in California was purchased for $45,000. After repairs and upgrades it sold for $215,000.
Click Here for a Free DVD That Shows You How to Flip Houses

What Repairs to Make to Maximize Profits

Our company, Capital Rehab Group, is a company with investors who actively flip houses across the U.S. Here is some advice on which repairs and upgrades are most important:

Kitchen and Bathrooms. Redo them from top to bottom. If you are not sure what materials to use, look at homes that sold for top dollar per square foot in the area and copy them.

Flooring. In most flips, use laminate hardwood flooring in the primary living areas and carpet in the bedrooms. Laminate hardwood flooring is difficult to tell apart from real hard wood. It is not only much more durable, and scratch resistant; it is also less expensive.

Paint. Paint every room in the home. If the walls have a lot of minor flaws in them, use flat paint. Otherwise, use an eggshell finish. And always use earth-tones.

Landscaping. Donald Trump himself stated that you get a $10,000 return for every $1,000 you invest in landscaping. It is amazing what rocks, trees, and shrubs can do to increase the perceived value of a property. A good rule of thumb is to budget 1% to 2% of the final expected sale price of your home for landscaping. Plant a couple flats of fresh flowers the day before putting the house on the market. This simple, inexpensive final step will drastically increase your overall profit.

Roof. If the home needs a new roof, replace it. But factor this into your costs before you purchase the home.

HVAC. Make sure the home has a working heating and cooling system. Air conditioning is a must in areas with warm climates like Florida and Texas.

Garage. Other than paint, do not spend much money here.

Back Patio. This is an often overlooked but important area. A simple $1,500 deck with two chairs, a small table in between them, and a couple wine glasses sitting on the table paints an awesome picture in the head of the potential buyer.

Have you considered flipping houses? We asked our expert from Capital Rehab Group, to outline what it takes to start flipping houses.

Flipping houses isn't for everyone. There is risk in real estate, but he explained you can minimize risk and the benefits of flipping houses are extremely rewarding.

Here are three strategies to be successful:

  1. Only buy properties with lots of equity;
  2. Be realistic about your expected costs;
  3. Seek knowledge from others with house flipping experience.

Our investors put together a Free House Flipping DVD to those looking to start flipping houses. Click Here.

Click Here to Get Your Free House Flipping DVD

It is a well known fact that real estate plays a big role in the investments of the wealthy. Finding, Fixing, and Flipping houses is one way that people are making their way into real estate investing. According to RealtyTrac, the average gross profit on a flip was $63,000 last quarter.

What Others Are Saying

Ben M. made a healthy profit on his first flip by purchasing a bank-owned property in a nice upstate New York neighborhood.

Tim S., a full-time real estate investor from Tampa, Florida, flips 3-4 houses per month by purchasing mostly bank owned properties.

With so many bank-owned houses it’s possible to find properties for pennies on the dollar in many markets in the United States.

house (appraised value = $214,000, asking price = $92,000)

Get a Free DVD that shows you how to find, fix, and flip houses like these. TIP: Buy houses with lots of built in equity. The appraised value of this house is $214,000 and the owner is asking $92,000. Click Here to start flipping properties in your area.

house 2

(appraised value = $118,000. Asking $32,000)

Foreclosures including HUD Homes, Fannie Mae houses, and REO properties are where you can find potential houses to flip at a deep discount. This house in Philadelphia was appraised for $118,000 and has an asking price of $32,000.

house 3

Here is a 3 bedroom, 1 bathroom property in nice condition. Houses like this one can make a good entry-level flip.

Click Here to Get a Free House Flipping DVD