How Seniors Can Start a House Flipping Business

Wondering what’s next? After leaving the workforce, many seniors find themselves searching for meaning in new hobbies, jobs, and personal projects. There are countless ways to channel your time and energy in retirement. And one exciting option is flipping houses!

House flipping has become one of the most popular real estate trends in the last few years. If you’re not familiar, house flipping involves purchasing property at a low cost—typically because it needs repairs or updates—to renovate and resell at a higher price. House flipping has the potential to make a lot of money. But, like all businesses, entering the house flipping market can be a risky investment, especially if you don’t know what you’re doing. Here are a few fundamental steps to consider before getting started!

Finding the Right Property

Research the housing market carefully before deciding to buy in a certain area. Flipping houses is becoming increasingly challenging in today’s competitive housing market, as it’s hard to find inexpensive homes to buy and flip. Market research is essential for finding deals on properties that are likely to produce a return when renovated and resold.

If you’re new to real estate, you should absolutely work with experienced and dedicated real estate professionals like Charley and Alisa Wasson. This will help you avoid common flipping mistakes like buying a fixer-upper that turns into a money pit. It’s a good idea to add at least 20 percent to your home renovation estimate to account for unexpected repair costs. Your real estate agent will help you find fixer-uppers in established neighborhoods that are close to amenities and include features that will appeal to future buyers.

The best flip-worthy houses are those that require minor cosmetic upgrades like a fresh coat of paint, new flooring, and landscaping improvements. Steer clear of properties with major structural or system problems!

Funding Your Flip

It’s no surprise that house flipping requires a substantial investment. Between purchasing property and covering repair costs, you have many major expenses ahead of you. Research your financing options carefully! FinanceBuzz outlines several funding solutions—friend and family loans, seller financing, home equity loans, personal loans, hard money loans, and 401(k) loans. Each of these financing options comes with its own benefits and drawbacks. If you need help determining the best solution for your flipping venture, talk to a financial advisor.

Before searching for a loan, budget your house flip as accurately as possible. Two of the most common problems people face when house flipping is spending too much on a home and miscalculating repair costs. Starting with an accurate picture of your anticipated costs will ensure you can complete your project before you run out of money.

Assembling Your Flipping Team

Assembling a team of knowledgeable professionals will save you time and money as you embark on your house-flipping adventure. Again, this is where many first-timers go wrong. Trying to do everything yourself will take much longer and likely wind up costing more, especially if you lack the necessary knowledge and skills. Plus, DIY flipping makes you responsible for obtaining any permits and licenses you need to comply with local regulations.

Hire people who know what they’re doing, and you’ll sail through the flipping process! Build relationships with contractors who you can call on for all of your future house flipping projects. You can find the best local contractors by shopping around, comparing estimates, reviewing examples of past work, and interviewing your top candidates. Besides contractors, you should also consider working with a real estate agent, CPA, insurance agent, and a real estate attorney to cover all your bases.

Balancing Work and Life in Retirement

Running a house-flipping business is a great way to enrich your retirement with a sense of fulfillment. But business ownership, while incredibly rewarding, does come with a cost. You will have to sacrifice some of your newfound retirement freedom for your business. Make sure this is what you want before committing to house flipping!

The process of house flipping involves a number of demanding steps. To get started, you’ll have to search for and purchase property, plan upgrades, and apply for permits. Even if you pay others to tackle repairs and renovations, you will spend a lot of time managing and directing your team. Then, you will need to market and sell the property. It’s a full-time job! If you want to test the waters before launching a full-fledged flipping business, try flipping a single property to see how you like the process.

If you’re prepared to launch a house-flipping business, you may want to register as a limited liability company to protect your assets just in case of litigation against you. Forming a Texas LLC is affordable and simple when you work with an online formation service.

If flipping houses sounds right up your alley, get out there and start learning the ropes! Anyone can learn how to find flippable properties and sell them at a profit. Starting a house-flipping business in retirement could be a great way to fill your free time and earn some extra income to fund your future retirement goals!

This content was provided by Jim Vogel, who can be contacted for more information at jim@elderaction.org, and is not endorsed or fact-checked by Charley nor Laughy Hilger Group LLC.  Do your own research and come to your own conclusions if this decision is the right one for you.