How to Find the Best Fix and Flip Properties in a Competitive Market

Investors love fix and flip properties because they provide them with a substantial return in a relatively short time period, and these returns serve as a good way to move on to larger, more long-term investments. Finding the right property to flip can be somewhat difficult however, especially in today’s competitive real estate market. The best properties to flip are in high demand both from browsing homebuyers and other real estate investors in the same market. It helps to have a clear idea of the types of properties you’re looking for though, and there are also some techniques you can utilize to help you find them. Continue reading to learn how you can find the best fix and flip properties in today’s competitive market environment.

Look for Distressed Properties

A home flip works best when you can find a distressed property that can be brought up to modern homebuyer standards with little work. Distressed properties generally fall under two categories: older properties that need cleaning and renovation, and neglected properties under financial distress. Both of these make for a good fix and flip project, because they leave a lot of room for increasing the home’s value through updates. Aside from browsing your local MLS, it may be worth looking into foreclosure or REO properties since you can find a great deal on a home there. Home auctions can also be a good place to secure a discounted property, although they are a bit riskier because you often cannot inspect the property beforehand.

Leverage Real Estate Agents and Wholesalers

You’re likely aware that your real estate agent will be a good source for finding the right property for your home flipping venture. Their level of experience and area of expertise will play a major role in your success with finding a good home. The right agent might even have access to properties before they hit the open market and can connect you with promising sellers. If you are still struggling to find a property, real estate wholesalers can be a great way to find homes for flipping, and they tend to have access to off-market properties that aren’t typically found on the MLS.

Utilize Data and Technology

Modern investors make use of technology to help them get a better understanding of a market’s overall health and make better predictions about the potential value of a property. You can start by simply browsing properties on sites like Zillow or Redfin to get an idea of the value of comparable properties along with the prices that homes have recently sold for. To get even more in-depth data though, you should look to utilize data aggregators like ATTOM Data or REiDEALMASTER. They have accurate, up-to-date information on various markets across the US, which can help you identify hot neighborhoods and investment opportunities within them.

Act Quickly but Strategically

As the saying goes: time is money, and when home flipping it can make all the difference in your investment. The most ideal properties for flipping will get snatched up quickly, especially if you’re competing with other fix and flip investors in your market. Be on the lookout for these opportunities, and be prepared to move fast on the deals that you do find. Having pre-approval for financing is one of the best ways to facilitate this.

At the same time, you shouldn’t neglect the due diligence stage of the process. It can help you avoid overpaying for a property, or getting stuck with a home that has some nasty renovation surprises waiting for you. Always get a professional home inspection done before making a purchase. It’s also possible to make offers that are contingent on a home inspection, and if a buyer is unwilling to accept this condition, it could be a red flag that you shouldn’t ignore.

Secure Financing for Competitive Deals

Financing can be a major issue that gets in the way of your ability to secure a fix & flip opportunity. Traditional mortgage loans often have an extensive application process which can take weeks or even months to complete. Additionally, their 15 or 30-year loan period doesn’t make much sense for short-term projects like home flips. This is where private financing comes in. There are private lenders who offer specialized loans designed for flipping, which provide you with renovation funds and funds to secure the purchase of a property. They are also much more flexible with loan terms, so you can customize the loan period and repayment options to maximize the value of your investment.

RCN Capital

The easiest way to save on your next investment is to obtain financing from a real estate lender that can get you 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 fix and flip project, RCN Capital has competitive loan options available.