Question about buying & selling homes???

Question

I'm intrestead in buying & selling homes, which i would buy them below value and pay a mortgage on them untill it is sold.

my question is:

if im paying a mortgage and sell the home how can get profit from this?.
i am deciding to sell these homes to those "we buy homes" companies & do i just sell the home above what im paying for?

can anyone give me any ideas how this can work.

thanks,

oxoxoxoxoox

Answer 1

okay what you are referring to is called "flipping". first off you will need capital to do this. most cases the houses that are bought are under value because they may be approaching or are in foreclosure- these are hard to find and usually they want large down payments to secure bidding. the second is homes that need work done- so you buy them and fix them up to resell them. the trick to that is you have to be able to do most of the work yourself or you will get stuck paying contractors and such to do the work for you.
I am in FL and every other person i know has tried this to make quick money fast and only 1-2 have been successful. it is not an easy job and you have to really understand the market and trends. even the best person can get stuck in a real estate slow market and loose money sitting on a property. i would suggest maybe working as a real estate agent first and making money with that- then you have access to the MLS system which is where all listings are placed which will give your first access to these sales and then start flipping on the side.

Answer 2

If you buy homes and use an agent you will end up paying them a % in commision. Typically the seller pays the full commision to the sellers agent which is split with the cooperating agent.
IF you buy a home below fair market value (FMV) it usually needs work and or updating. So if you buy it below FMV, invest money into it by updating /repairing it, you will need to make sure that the house will sell for at least what you invested in updating the home, the agents commision, closing cost, etc. You need to make sure you break even. Obviously.
My suggestion is find a real estate agent. Find one that, if you are serious about this, you want to build a long term relationship with.
And before you sign any paperwork, two things 1)NEGOTIATE the agents commision. MOST agents come in at 6%. Some will negotiate down if they thing this will be a multiple sell/buy relationship. Other, like myself, believe our time is worth 6% regardless. I refuse to go down on my %. This is my business, my job and I refuse to let go of part of my paycheck. If I am willing to let go of a deal simply because of 1%, is that the kind of "bullheadedness" you want in your corner when it comes to negotiating? Do you want an agent that willing to give up his paycheck? And 2) interview other agents from other real estate agencies. IF you are serious, this could make you a pretty penny and you want someone that you trust and can get along with personaly and professionaly. True it is a business "relationship" but if this is a long term thing, you will want to get to a point where the agent just "knows" you as well as you "know" them.
I would avoid the "we buy homes" places. They will very rarely pay you what it is worth.
There is so much more little stuff than what could be written here. My advice, find a real estate agent and talk to them since each states laws and their real estate markets are different. They may tell you to save some $$ since the market may not be right for this kind of a venture.

Good reading before you embark.
http://www.amazon.com/FLIP-Find-Sell-Houses-Profit/dp/0071486100/ref=pd_bbs_sr_2_s9_rk/104-0759575-8951908?ie=UTF8&s=books&s9r=8afd079f0eefbbe9010feed28b440be3&itemPosition=2&qid=1182994686&sr=8-2

Answer 3

You will not have success buying and selling homes if you plan on selling to those "We pay cash for homes" companies. They buy homes at heavily discounted rates and will not pay you enough of what you need to turn a profit.


This is a much tougher time for house flipping than in the past in most areas. You really need to be patient, take your time to find the right homes, make sure you are looking at the homes with someone that is very experienced in home repair and do your "homework". Below are a few links with some good information about house flipping. Good luck to you as this can be a very lucrative business if done properly, but it can also be a money trap if not done right.

Answer 4

Oh dear. I have news for you. Those 'we buy homes' programs will pay YOU less than YOU paid for the property. They are in the same game you are attempting to get into.
Do not expect to see any offer exceeding 75% of fair market value from any of those programs.

You are talking about the concept called 'flipping', and the profit structure in that is very shaky right now. With the current real estate market atmosphere, you could find yourself buying a home 'below value', fixing it up, and trying to sell it, only to find that it's value is now below what you have invested in it.

From the sound of your knowledge in this area, I would recommend that you hold back until you get a very firm knowledge of what most real estate markets are doing right now.

Answer 5

hahahahahahahaa, like im going to tell you how to turn a profit. give me 10% on all your homesales and i will make you a millionesse