By Tony Button
Which is preferable: property flipping or real estate property investing?
To reach an answer, it may help to identify each term and put each one in perspective.
Home flipping is the strategy of acquiring a residence then reselling it at a profit in the smallest period possible. A house flipping pro aims to make the biggest amount of cash really fat by flipping the house, therefore the term is called house flipping.The house flipper does not hold on and rent the house. As a matter of fact, the shorter they hold the house, the better it is.
A real estate investor holds the home for rental income then either keeping the house for a while and selling or keeping it for rental income.
Real estate investors may buy with the intention of selling later, but may hold onto the house for many years.
Which form of investing is the best for you and your family?
The main difference between the two investment schemes is that in house flipping, the investor is looking for quick profits while the real estate investor is more concerned with steady income.
House flippers target houses that they can buy at a cheaper rate than the normal market rate. In doing so, it guarantees a quick profit from a quick sale.
Usually, the real estate will be sold at a price much less as compared to its selling price (in the range from 40-80% below market price).
Renovating a fixer upper is a popular way to house flip. The house flipper buys the house, renovates and sells it in a very short time.
Renovating is much cheaper as one can precisely estimate the cost of materials and labor required to do it. It is usually easy to get specialists who grasp the exact renovations required and the house will look really good for a quick resale when it's done.
This enables the house flipper to get a quick market for the house and at the same time fetching a very good price for the house.
House flipping tends to be more hassle free than real estate investing especially where the flipper is just buying a house and selling it without doing any renovations.
Where a house flipping pro works is important as well and this depends on the local real estate market in large part, the house flipper can make higher return on investment (ROI) if he/she can manage to flip the houses in short times. The real estate investor holds the property and rents it to renters, thus making cash flow instead of a quick buck.
With buy and hold real estate, the investor makes money through income, provided his expenses are less than his income from rent. A major advantage is if the market is poor he can hold on and receive income and not worry about resale.
Additionally, the buy and hold real estate investor can also leverage bulk buying of renovation materials if he is going to do multiple properties at once
For hassle free and quick return on investment, I am biased in favor of house flipping...but you be the judge!
To reach an answer, it may help to identify each term and put each one in perspective.
Home flipping is the strategy of acquiring a residence then reselling it at a profit in the smallest period possible. A house flipping pro aims to make the biggest amount of cash really fat by flipping the house, therefore the term is called house flipping.The house flipper does not hold on and rent the house. As a matter of fact, the shorter they hold the house, the better it is.
A real estate investor holds the home for rental income then either keeping the house for a while and selling or keeping it for rental income.
Real estate investors may buy with the intention of selling later, but may hold onto the house for many years.
Which form of investing is the best for you and your family?
The main difference between the two investment schemes is that in house flipping, the investor is looking for quick profits while the real estate investor is more concerned with steady income.
House flippers target houses that they can buy at a cheaper rate than the normal market rate. In doing so, it guarantees a quick profit from a quick sale.
Usually, the real estate will be sold at a price much less as compared to its selling price (in the range from 40-80% below market price).
Renovating a fixer upper is a popular way to house flip. The house flipper buys the house, renovates and sells it in a very short time.
Renovating is much cheaper as one can precisely estimate the cost of materials and labor required to do it. It is usually easy to get specialists who grasp the exact renovations required and the house will look really good for a quick resale when it's done.
This enables the house flipper to get a quick market for the house and at the same time fetching a very good price for the house.
House flipping tends to be more hassle free than real estate investing especially where the flipper is just buying a house and selling it without doing any renovations.
Where a house flipping pro works is important as well and this depends on the local real estate market in large part, the house flipper can make higher return on investment (ROI) if he/she can manage to flip the houses in short times. The real estate investor holds the property and rents it to renters, thus making cash flow instead of a quick buck.
With buy and hold real estate, the investor makes money through income, provided his expenses are less than his income from rent. A major advantage is if the market is poor he can hold on and receive income and not worry about resale.
Additionally, the buy and hold real estate investor can also leverage bulk buying of renovation materials if he is going to do multiple properties at once
For hassle free and quick return on investment, I am biased in favor of house flipping...but you be the judge!
About the Author:
To get information on how to flip a house, check out www.houseflippingschool.com where you can get more information on real estate investing too.
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