So you want to know how soon you are going to be rich? Of course, we won't answer that question in this blog, and you aren't going to get rich with one flipped house.
But if you're thinking about getting into the house flipping business or already started on your first house and wonder how soon you're going to be out from under, we can give you some general ideas.
You should understand, though, every experienced house flipper is going to tell you there is no standard answer on how long a typical fix/flip takes, as there's rarely a typical fix and flip. But here's a general timeline on a smooth fix and flip:
We won't factor in the time you spent looking for the house, as once you're going, that's an ongoing, constant process. Generally, if you have cash in hand or have your financing in order, you can acquire your house in 5 to 10 days when buying from a bank or private seller.
If the house is a short-sale or from an estate, you can plan on adding an extra one to three months to gain approval through the courts or a lender. If it's a rental, you might need a month to get the renters out as well.
Unless you're a finance person or investor, this is going to be the part you'll be most involved with. This is also the part that can make the most spread in how long your fix and flip will take.
If the remodeling is mostly cosmetic, cleaning up and minor fixes, it can be done in a few weeks, particularly if you're working with a good contractor.
If the remodeling is more extensive, more factors will come into play. Doing the work yourself or with family definitely will slow down the process. But maybe that's what you want as you enjoy the process of reviving an older house and bringing it back to life.
If you hire a contractor and full crew to get the work done more quickly, you'll be spending more money and eating into your profit. But time is money, so maybe it's worth speeding up the process.
All these various factors can stretch your remodeling time frame from a couple of weeks to 6 months or more if you're going the work yourself. We'll say 2 weeks to 2 months, generally.
This is a process you rarely can shorten, but it sure can drag out longer. Even if everything goes well, you normally can figure 1 to 2 months to sell the house.
You'll want to advertise for about 10 days before your first open house to ensure buyers are aware of the house. If you list it through a multi-listing service (MLS), you'll likely give up a little more money for commissions, but these real estate agents will know the motivated buyers.
Since you're not selling to another flipper, your target buyer typically will need to secure their loan and go through escrow.
Where you could really lose time here is if your house is over-priced for the market, if the market has shifted while you're doing your remodeling, or if your initial buyer can't get financing and you have to start over.
If everything goes perfectly – you buy quickly, do a simple remodel and find an eager buyer – your time frame on a flip could be a little as a couple of months. But don't count on everything going quickly, especially your first time out.
Experienced flippers say they generally figure a flip will take 6 months. If they make it in less time – gravy. If it's more, hopefully, it's not the only flip they have going and they can count on a revenue stream from another project.
One way you can speed up the process is to have your financing lined up before you find the house you want to flip. Contact us to start the process so you are ready with purchasing and rehabbing funds when that house comes along.
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