Whether you are interested in buying a home to “flip” and resell, focus on commercial ventures, or rent property to tenants, we are here to guide you through the real estate investing process and assist you in keeping things as smooth and simple as possible. If you are just getting started with real estate investing, read on to get familiar with the basics.
Fix-and-Flip vs. Buy-and-Hold
From “Flip: How to Find, Fix, and Sell Houses For a Profit”, by Rick Villani and Clay Davis
The first decision that must be made in the real estate investing process is which method to choose. You may even find a combination of both may be the best choice for your situation.
Fix-and-Flip: House-flipping is a concept composed of three actions: buying, rehabbing, and selling. The basic idea is that a home is bought below market value, fixed up to significantly increase value, and sold for a profit. Ideally, this is a quick investing process, with property bought, rehabbed and sold in as little as a few months to avoid unnecessary carrying costs, such as interest, insurance, taxes, utilities or maintenance.
Buy-And-Hold: With this investing strategy, a home or property is bought and held on to for an extended period of time. During the hold period, the property is rented out to tenants providing a steady monthly cash flow. At some point, when the property has appreciated in value, the home can be sold for a profit or held indefinitely. This strategy provides two possible income streams: rent and increased value.
Here is an amazing example of how we work with our real estate investing clients. Our team helped our client to purchase, renovate and re-sell this beautiful townhouse. Interested in learning more about how we do it? Give us a call so we can walk you through the details of our investing process.