Reality fixes and flip TV shows have given the real estate investment industry a boost. However, what you see on reality TV shows isn’t exactly what you could expect in reality. Understanding the differences will help you decide if this type of venture is right for you.
How Easy Is It to Sell?
If you’ve watched fix and flip reality shows, they make it seem like there’s always a buyer waiting in the wings when the project is over. It’s important to remember reality show hosts are well known, and people are eager to buy from them. For most real estate investors, you will likely need to aggressively market the home to reach potential buyers. Prepare to wait months to complete the sale.
How Common Are Big Surprises?
Fix and flip shows almost always discover some big surprise while renovating a house. It makes for engaging TV. There’s also the possibility they are already aware of these “surprises,” and it’s all an act. When completing your own fix and flip, it’s essential to look carefully at a home before buying. Look for severe problems like pests, faulty wiring, water damage, and foundation issues. It will save you money in the long run.
How Fast Is It Done?
It’s essential to remember fix and flip reality shows are taped over a long period and consolidated into the appropriate time frame. Some of these shows even use rapid flips as part of their appeal. For most real estate investors, however, renovating a home to make it profitable takes time, often weeks or months. If you’re not prepared to work over the long haul, fix and flip investments aren’t right for you.
How Easy Is It to Find Properties?
Fix and flip shows frame buying a home as a fast process. They may talk to fellow investors or real estate agents, browse through listings, or attend auctions, but you need to remember much of the time spent ends up on the cutting room floor. It’s unlikely you will find the most appropriate property in a short time. It’s essential to choose carefully, so you don’t end up working on a home you don’t have the money or time to complete properly.
What Kind of Funding Is Available?
Funding is one of the most essential aspects of a successful fix and flip. Few real estate investors have the capital available to handle financing on their own. Celebrities featured on fix and flip shows often use their own money or get funding from sponsors, making their tactics unrealistic for most investors. Instead, many real estate investors have to turn to options like a hard-money loan to afford the purchase and the renovations they need to do. This is often the best lending option available to real estate investors interested in the fix and flip process. You can make payments while renovating the home and pay off the remainder of the loan when it sells or roll it over into a new investment.
If you’re thinking about getting involved in the fix and flip real estate investment options, contact us. We can help you get the funding you need for your project.