| Though "flipping" real estate has become a popular | | | | on, there could be trouble. The seller, aware that |
| practice, it is also pretty controversial. This is | | | | the flipper is in dire straits, will probably up his |
| mainly because people have gotten into it without | | | | price. The seller now knows the buyer is |
| considering the ramifications of their actions and, | | | | expecting that property. It is even possible that |
| consequently, engage in some very bad practices. | | | | the flipper has sold the property to the buyer and |
| The clumsy flipper can anger both the buyer and | | | | is then turned down by the seller. This puts the |
| the seller-not to mention get themselves into | | | | flipper in the position of having just sold something |
| some very awkward and costly situations-by | | | | he can't deliver. |
| flipping real estate. However, that doesn't mean it | | | | According to Ken McElroy, author of "The ABCs |
| can't be done. | | | | of Real Estate Investing," there are, however, |
| Flipping is simply the quick selling of a property | | | | companies that flip very successfully. This is |
| that one has just purchased. The sale may take | | | | because they follow a few simple rules, such as |
| place that very day, or even at that very closing. | | | | never selling something they haven't actually |
| The idea behind this practice is, if a property | | | | purchased. On the surface, that sounds like such a |
| appreciates and I'm just going to turn around and | | | | basic idea, it is not necessary to mention it. |
| resell it at a profit anyway, why wait? Why not | | | | However, you would be surprised if you knew the |
| buy up a whole bunch of properties, sell them | | | | number of people who try to get away with not |
| quickly and make a ton of money? | | | | following this simple rule. |
| See the allure? It can be done, but it is a tricky | | | | The companies who flip will resell a property that |
| business. You cannot be a successful flipper | | | | very day if at all possible, but they don't sell at |
| without using some finesse. For instance, many | | | | the very closing where they purchased the |
| people think they are being hugely clever by | | | | property. Instead, thy use mailing lists they have |
| working the seller and the buyer against each | | | | built over time to send out bulletins that they |
| other. The flipper, who sets himself up as a | | | | have a property for sale. It can cost hundreds of |
| middleman without the knowledge of either party, | | | | dollars to get the word out and arrange meetings. |
| actually gets the seller to agree to sell to him, | | | | It can also require an entire staff to do it quickly |
| then runs to the buyer for the cash, from which | | | | enough to make it pay off. |
| he pays the seller. Using this method, he makes | | | | Because of those particular limitations, it is often |
| the purchase without even using any of his own | | | | not lucrative for an individual to attempt flipping |
| cash. Afterward, he simply pockets the | | | | properties, although, conceivably, a particularly |
| difference. | | | | savvy individual could indeed make it pay off. The |
| But if he has sold a property to the buyer that | | | | question is, is it a good approach for you? |
| isn't actually his, and the seller learns what is going | | | | |