Investor Information Back
Vacant Properties in the Winter Months
If you don't want to pay a heating bill during the winter months for your vacant property, you must winterize it to avoid freezing pipes. Here is what is involved with winterizing a property:
- Turn the water off to the entire house.
- All water lines are bled.
- Anti Freezing liquid is put down the drains.
- If gas heat, gas is turned off at the main.
- Leave their emotions out of the equation when considering a property. The property either makes financial sense or it doesn't. If it makes sense, then explore buying it; if it doesn't, move to the next one.
- Look for resale - sooner or later
- Sharpen their pencils, do the math and make an offer.
Every Investor/Flipper needs to have a handle on remodeling costs. Completing an Internet search on the phrase 'calculating repair costs for house' yields over 8,000,000 hits. So there is plenty of advice out there. Do some research before you start it, will be worth it!
Professional Investor/Flippers are successful for one or more of the following reasons:
- Carefully evaluating the property before purchasing it (most successful investors/flippers reject more properties than they purchase)
- Making a comprehensive estimate of the cost needed to bring the property up to marketable condition, and also plugging in carrying costs, profit and cushion
- Having adequate resources to cover unexpected repairs
- Being either contractor themselves, or employing contractors and they rehab the house in a timely manner
- Not spreading themselves too thin by acquiring more properties than they can rehab
- Being knowledgeable about the property or hiring a third party to inspect it for them
- Having a 'Plan B' in the event the house does not sell - usually they plan to rent it (or vise versa).
Typically, Invester/Flippers get in over their heads for one or more of the following reasons:
- Failing to adequately estimate the cost of repairing the property
- Failing to allow for 'carrying costs' (e.g. interest payments, taxes and insurance paid while waiting for the home to sell)
- Failing to have enough cash in reserves to finish the project
- Relying on themselves, friends or family to do repairs, which leads to the project taking much longer than it should
- Hiring an unlicensed contractor who takes their money and disappears
- Getting into more projects than they can manage
- Buying 'sight unseen' because 'it is such a deal'
- Not planning for a downturn in the market