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When it comes to the unplanned hiccups that can affect the ROI of your fix and flip project, falling off schedule is at the top of the list. Keeping your project’s turnaround time as short as possible, without sacrificing quality, is the best way to keep your ROI as high as possible. Luckily, with the right planning, you can save huge on your project’s timeline. Here are 5 important factors that can help keep your fix and flip on schedule.
Do Your Homework on Fix and Flip Projects
If you’re considering investing in a fix and flip property, or investing in any property for that matter, it’s important to do your homework. Putting in the work of researching the ins and outs of a project will help you avoid any surprises during the process that would otherwise extend your project by weeks, or even months. It's also good idea to create a detailed list and carefully plan a schedule to keep you on track.
Have a Backup Plan for Budget Bottlenecks
After setting the scope of your project, you’re going to want to create a detailed budget that includes everything from the cost of buying and improving to marketing and selling your property. Unfortunately, fix and flips often run into unexpected issues that can disrupt the schedule and your overall budget. When financing your fix and flip, you should add a buffer to your budget that can fund those surprises.
If you’re working with a fix and flip lender, be sure to ask about your loan options in advance if your project comes to a standstill due to unforeseen problems.
Have Backup Contractors
There are many contractor horror stories out there, and unfortunately hiring the wrong contractor can harm your ROI drastically. References or referrals of contractors from family, friends, or someone you can trust is the best way to ensure you’re hiring a good, licensed contractor.
If you find a contractor who meets all your qualifications, it’s a good idea to have a backup just in case things go south with your first choice. While this may disrupt your schedule depending how far you are in your project, having a backup is better than starting from scratch.
Intervene if Your Property isn’t Selling
Each week your flix and flip sits on the market is eating away at your ROI. This is one of the reasons why it’s so important to accurately estimate your ARV at the beginning of your project. The best thing to do in this situation is go back to the drawing board and compare your renovation to other homes in the area, and ensure you're not comparing your fix and flip to dissimilar homes.
To further avoid your property sitting, make sure buyers are aware of your listing. All too often, sellers find out way down the line their MLS listing was incorrect or incomplete. Additionally, many buyers are searching online before they even contact an agent. Be sure your home is accurately listed on real estate sites for exposure.
Fund Your Next Fix and Flip and Stay on Schedule with RCN Capital
Here at RCN Capital, we offer a variety of loan programs and real estate resources. Analyze your next investment property, develop an accurate scope of work, minimize your risk and maximize your ROI with our rehab cost calculator.
Looking for funding for your next fix and flip project? RCN Capital’s ARV loan program offers financing for up to 90% of the purchase price plus 100% of renovation costs, not to exceed 75% of the after repair value. Contact us today to learn more about our loan options.