November 27, 2019 Last updated January 24th, 2020 490 Reads share

Three Reasons Why 2020 Is the Year of Flipping Houses

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The flipping house business has been a profitable business domain in the U.S. market. Even after the economic recession, this business sector continued to rise. And according to the latest reports, this business domain is here to flourish and succeed. However, as the year comes to an end, many real estate investors think whether it’s a smart decision to invest their time and money in a flipping house business.

It is somewhat difficult to answer this question, as the real estate market keeps on changing with economic fluctuations. But to date, industry changes haven’t stopped property investors from coming up with the best scopes to earn ample profits from flipping house business. It all depends on the way you are viewing the market. To know more about this, you can check out more about flipping homes in Dallas.

Several reasons make flipping houses a lucrative business opportunity in 2020. The important ones are as follows

The Home Supply and Costs

Years back, a flipping real estate was the ideal investment option for people who wanted to rehab properties and make money. Also, the housing marketing had the best foreclosures and vacant properties. The real estate investors could purchase a house from the bank and make the essential repairs. After that, they could sell it on the market.

In 2019 the home prices have increased. And that makes matters difficult for the property investors who aim for homes at a reduced cost. Hence, keeping in mind the economic condition, the potential house flippers with some extra capital can find the correct bargain and start their house flipping business. It is a favorable time for this.

The Return on Investment

Based on the reason discussed earlier, the flipping real estate business is meant to flourish. Going by the statistics, the houses flipped back in 2018 quarter one, made an approximate profit of $69,500, which is more than what it was back in 2017. Also, this average gross profit resulted in approximately 47.8% ROI in comparison to its original acquisition cost.

There Are Better Opportunities Present in the Suburbs

The suburban areas are probably the ideal place to start your home flipping business. Real estate experts have mentioned that 2019 onwards, some of the best scopes for flipping house business will be present in the suburban areas. At times, it might get difficult to come across a home or condominium to flip when the market is tight and earn a profit, and a suburban area might present potential business opportunities that real estate agents can grab and leverage the most.

However, it is essential not to get tempted to opt-in for the cheap house deals available in the low-income localities and neighborhoods. That is a bad start for your business. The increased crime rate, along with the many foreclosures, will negatively impact the property value. It will make it challenging for you to re-sell the residential property. The best solution is to start the business in a suburban area that is getting developed and provide ample amenities and security from public threats. In such a situation you can sell the property more and make good profits.  You can use the pointers mentioned above to make informed business decisions.

 

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Jason Norman

Jason Norman

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