How to Flip a House With a $5,000 Budget

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How to Flip a House With a $5,000 Budget. Flipping a house on a budget is a real challenge--but if you are handy with doing household repairs, it can be done. The secret to flipping a house with little money is not only your labor, but finding the right house.

Find the Right House

Check the local courthouse for new filings of bankruptcy, foreclosure or lis pendance (a notice to file foreclosure) to find a good house to flip. Also check the local paper for "handyman specials," call local realtors and place an ad in the local paper.

Knock on doors to find and ask if the owner is interested in selling. Surprisingly many are interested in selling but have not contacted a realtor yet. If they aren't interested in selling, ask them if they know of anyone who is.

Find the ugliest house in the nicest neighborhood and one that does not need structural or system repairs. This is the ideal type of house to flip. Cosmetic repair and updating will use most of your $5,000 budget.

Determine the Cost of Repairs

Price the necessary building materials at a big box store first. Visit the contractors' supply section, you should be able to get a good discount for the whole remodeling job.

Visit a used building materials supply store, they can save you a great deal of money if the supplies are in good condition.

Paint whatever you can, including appliances that are in good working order, but look old and used. Paint is the cheapest and best way to quickly improve a house.

Determine which jobs you will need help with and call a local licensed handyman for an hourly rate. Enlist the help of friends and relatives; or hire local teenagers for jobs you need help with.

Sources of Cheap Supplies

Stroll through large flea markets to find permanent booths. Some used building suppliers have been at the same flea markets for more than 20 years.

Browse the local classified ads for people that are advertising used materials and supplies. The local classifieds are a great source for used appliances in good condition.

Check hotels and apartments that are remodeling and talk to the owner or builder. You may be able to get used supplies or materials just for moving them out of the way. This is a great source for carpets, lights and cabinets.

Visit local thrift stores, such as Habitat for Humanity for used building supplies. The Salvation Army thrift store also is a good source for used materials and furnishings.

Search for scratch and dent appliances or overstocks at a local store. If you don't see any, just ask. Most stores have them, but do not publicly advertise it.

Look through the local phone book for building supplies and include the subcategories of used, recondition and repair.

Selling

Determine if you should sell on your own, based on real estate commissions and your bottom line. A realtor can save a great deal of time because they already have qualified buyers on hand.

Advertise in the local papers and online. You can place classified ads online or set up a webpage just for the house. Make sure you list the sales price and have photos for prospective buyers to see.

Host an open house that has been well advertised. Have coffee and snacks on hand which will make people feel more at ease. Keep a sign in sheet with names and phone numbers of the people attending. Have music playing softly in the background that lends an "at home" feel to the open house. Hand out a flyer that has a photo of the house and pricing information; attach a business card to it. Return all phone calls and answer all questions as soon as possible.

Tips & Warnings

  • Clean all carpets professionally to remove stains and lingering odors.
  • Place fresh flowers in the entryway, foyer and dining room for a wonderful look and fragrance.
  • Put a bowl of fresh fruit on the kitchen counter to make the house feel more like home.
  • Place matching towels, wash cloths and guest soap in the bathrooms for a finished effect.
  • Wash all windows and mirrors until they gleam, then add fresh new window treatments.
  • Invest in time and labor for the exterior of the house, which is the first impression a buyer will have.
  • Haul away all trash from the interior and exterior of the house.
  • Pick up any tools or building supplies and store them out of sight.
  • Keep track of the batch numbers or paint formulas in case you need to order more of the same color.
  • First impressions count! The curb appeal of your house is probably the most important part of flipping it. Landscape with plants, paint the exterior, add shutters or window boxes to add to the curb appeal of the house. Don't forget to include the mailbox, light fixtures and front door. If prospective buyers don't like the look of your house, they won't come inside.

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