Among the more popular ways to earn a living in real estate is to buy homes for cheap and sell them for a profit. The recent economic hardships in the housing industry have put many of these entrepreneurs out of business altogether. But could the time be right to return to this line of work? Here are a few things to consider
1.) The price of homes is still falling- While it’s impossible to know exactly where the bottom of the housing market lies, you’d like to get as close to it as possible. That’s because acquiring houses cheaply is the surest way to turn them around for a profit. A house acquired cheaply has less of a haul to make towards profitability.
2.) People really aren’t buying yet- It is true that there have been a few spikes in existing home sales over the last year but that does not correctly showcase the current housing climate. In reality, until new home sales pick up too, it’s difficult to believe it’s not still entirely a buyers market. The worst thing you can do as a house flipper is to get stuck with a property because no one want to look at it or buy it.
3.) Banks are still not lending much- Indeed, banks seem content to sit on a pile of cash rather than to lend it out, despite the fact they have been asked and ordered by the government to do so. The country is still in a relatively fragile state economically and people are not all too sure we have bounced back for good.
Given these factors, it looks like we are still about a year and maybe more from prime house flipping time. Just as prices begin to rise, purchase the cheapest of real estate and fix it up. Who knows, maybe this time it can be your riding the bubble to profitability before it bursts.
