5 Ways Brokers Can Leverage Fix and Flip Projects to Grow Their Business

Fix and flip investing is a lucrative and ever-growing strategy in the world of real estate. Investors can take older or neglected homes and turn them into desirable properties while also making a tidy profit. These homes offer attractive returns in a short period, which make them a great way for first-time investors to generate capital for future projects. These investments also present a great opportunity for brokers and lending partners to expand their offerings and grow their businesses.

Read on as we cover 5 ways real estate brokers can leverage fix and flip projects to reach new markets and provide more tailored financing options to their clients.

Understanding the Fix and Flip Investor’s Mindset

Brokers who have a good understanding of fix and flip investing are better positioned to provide effective advice to clients and build lasting relationships with them. Identifying the right properties to flip is a crucial part of this process. Generally, flippers will look for neglected properties located in desirable areas, which can be brought up to modern homebuyer standards without too much work. Speed and efficiency are incredibly important to home flippers, because these deals are meant to be completed in a short period and holding on to a property for longer will incur more carrying costs.

It’s a broker’s role to understand the common challenges investors face when flipping homes, and help their clients avoid these risks to have successful deals.

#1: Build a Strong Network of Repeat Clients

Fix and flip investments can be completed in just a few months, and home flippers tend to move on to other, larger investments, or just keep on flipping. This presents a great chance for brokers and lending partners to build lasting relationships with these clients, along with the opportunity for repeat business. After working with the client once already, you have built a solid foundation of trust and credibility which will make them likely to return to you again for financing solutions.

Bonus tip: Stay in regular contact with past clients. Building an email list is a great way to achieve this. You can send out market updates and deal alerts regularly to stay top of mind and be just a quick reply away.

#2: Partner with Private Lenders for Competitive Financing Solutions

Fix and flip investments demand a certain kind of financing, since the 15 and 30-year period of a conventional loan doesn’t fit the shorter timeline of a home flip. Partnering with reputable lenders that offer programs designed for fix and flip investments can give you a leg up on the competition. Investors will be looking for access to fast, flexible financing that can be approved quickly and that they can tailor to their specific deals.

It's important to understand which types of fix and flip financing options are available, including hard-money loans which are backed by collateral, and bridge loans designed for quick acquisitions. You can then relay this information to your clients to help them choose the program which best suits their needs.

#3: Leverage Market Data to Help Investors Make Informed Decisions

No real estate deal has been successful without an appropriate amount of due diligence. Providing data-driven insights to your clients helps them find better properties, make more profit, and positions you as a trusted industry expert. One of the easiest ways to do this is to find comparable properties in the same market as the home your client is looking to buy. This can help you give more accurate ARV (after-repair value) numbers and guide their decision-making process.

Additionally, you can make use of data aggregators like ATTOM Data and REiDEALMASTER to gather accurate information on real estate markets. They can provide you with up-to-date figures on population growth, property values, and the general health of the area’s job market, all of which are important factors in real estate demand.

#4: Expand Lead Generation Through Strategic Marketing

Marketing isn’t just for investors looking to find homebuyers, brokers can also attract investors through targeted strategies. Creating ads and content that appeals specifically to fix and flip investors can be a very effective way of acquiring new clients. Implement a comprehensive strategy that includes blogs, emails, social media posts, video updates on your offerings, and digital marketing through SEO and PPC efforts.

Don’t neglect the power of networking either. Joining real estate groups and attending industry events is a great way to get the word out about your company, as well as connect with other like-minded professionals to generate referral business.

#5: Provide Value-Added Services to Stand Out from Competitors

The key to providing excellent customer service to your clients is offering additional support beyond just securing financing for them. Having a network of trusted real estate professionals you can refer them to is just one of many great ways to do this. Connect with a few trusted contractors, tax professionals, and real estate agents, and you can recommend them to your clients when needed. We have already mentioned offering deal analysis and ROI projection services to your clients but helping them design a good exit strategy is a further step you can take to ensure their success. For instance, you may want to recommend a contingency plan in case their first strategy does not work out as they had intended.

There are all sorts of ways brokers and lenders can offer additional value to their clients, and it can even be something as simple as offering resources on how to maximize their ROI. Your clients will be sure to appreciate the extra help, and it helps position you as an all-around expert in the industry, making them more likely to come back to you for repeat business.

RCN Capital

The easiest way to save on an investment is to obtain financing from a real estate lender that can provide you with the best leverages and rates. RCN Capital lends to real estate professionals, commercial contractors, developers & small business owners across the nation. We provide short-term fix & flip financing, long-term rental financing, and new construction financing for real estate investors. If you are looking to finance a real estate project, RCN Capital has competitive loan options and an award-winning broker referral program available to partners.