Flipping houses is a money making reality for Corus/WNetwork’s Property Brothers who make outstanding improvements to homes for about $80,000. That’s enough to create a very impressive, newly refurbished home that might be the best home in the neighbourhood.
So, if you should be fortunate enough to find a property that needs upgrades and you’re sure they can be accomplished, you might be able to do it. One thing for sure, investors are flipping houses. The only question is, is it worth the effort and risk?
The answer: Yes. Realty Track discovered that in the US, it is very profitable. ROI’s from 43% to 89% on average were reported. On average, flippers profited by more than $50,000.
Know the building code, zoning, and tax restrictions thoroughly before making the leap. That last thing you need is a nasty surprise.
If it’s a one-time flip of a house you’re living in, then it may be tax free. But if you’re doing this for a living, expect your capital gains to be fully taxable. Should you be interested in a flipping strategy, check out the story of Cindy Wennerstrom.
GTA Home Prices on the Rise
The latest TREB stats provided via the Globe & Mail show homes Sales rose 15.4 % from a year earlier. 10,180 home sales transactions took place which is almost 900 more than the 10 year average. The pace is expected to moderate so a long term flip might raise the risk a bit.
As you can see in this graphic below, sales prices have jumped considerably even since last year.
The GTA market continues to improve and looks to be set for further price rises and growth in prospective buyers. The lacklustre economy actually helps those who are hoping to buy a property to flip. There might be some properties available at a reasonable price particularly in Durham and York Region.
HGTV’s Scott McGillivray Believes Right now is a Good Time
Scott McGillivray, host of HGTV’s Income Property believes there is a fantastic opportunity for flipping. He should know, he does a lot of it, and a lot of the actual work himself. The renos range from replacement doors and new windows to home rewiring to building new showers.
Scott is quoted as saying flippers should think about the amount of work needed, the skills possessed, never compromise on quality, and calculate your expenses accurately beforehand. He also says get started right away.
You could earn 5% profit on stock investments, but you could potentially make $50 to $100k profit on a house flip. There are beautiful neighbourhoods with older houses that need major overhauls. But for the most part, you can keep the exterior structure of the house and gut the rest. Then you can shape into the open concept style everyone likes today with new kitchen, bathrooms, and bedrooms. And since you make it into the latest style, you have a home that is perhaps the most modern in the area.
Golden Opportunity to Really Doll the Property Up
You’ll have an opportunity to install glass showers, glass railings, custom mirrors, and new windows all round and you should certainly talk to us about our products and installation services. Our professional services and products can actually add value. The quality of our brand and products assures buyers they’re getting something they can count on.
As the piece de resistance of your home, you might consider a solarium or sunroom. There’s no better time to give your property something so cool it can justify the large price you’re going to demand.
Whether you can turn a profit in today’s economy really depends on the specific property you choose. Towns like Uxbridge, Stouffville, Aurora, Newmarket, and Keswick may have potential.