For the past ten years, El Paso’s population has grown by an average of 0.91% per year. In contrast, the national average was 0.69%, and the yearly rate for the entire state was an average of 1.63%.
The most recent ten years saw an annual change in El Paso home prices of 0.21. During that time, the state as a whole experienced an average annual home value appreciation rate of 0.43. The average yearly appreciation rate for properties nationwide was 0.13.
You probably understand there’s a lot to learn if you’re just starting out with purchasing and flipping houses in El Paso. Contrary to what you might see on TV, purchasing and flipping houses isn’t as simple or easy as it seems.
But if you invest the time to understand how to do it correctly, you can succeed at flipping properties. Additionally, there are strategies to reduce your risk and shorten your learning curve.
How to get started with flipping houses in El Paso
Expert investors could utilize different strategies when flipping homes. However, if this is your first time, the following step-by-step instructions might be helpful:
Get to know contractors
Before you purchase your first house in El Paso to fix up and sell, you should begin cultivating relationships with contractors. Get quotes as soon as the property is under contract, if not before.
Creating a network of tradespeople, including general contractors, painters, roofers, electricians, plumbers, and HVAC specialists, is a crucial step in learning how to flip a house. Learn about a few less expensive, all-around handymen as well.
Building a network is half of the house flipping industry unless you are doing the labor yourself. Along with a superb realtor and home inspector, contractors play a crucial role in this network.
Locate a house to resell
Finding good discounts is a skill that is essential to learning how to flip properties. This entails not only paying less than market value, but also making a purchase with sufficient profit margins to pay for all of your out-of-pocket expenses, including two closings, Realtor fees, carrying costs during renovations, and, of course, your time and labor costs.
Finding homes in El Paso at below-market prices to resell can be done in a number of ways. You may create a direct mail marketing campaign, work with wholesalers to uncover off-market offers, collaborate with a realtor to find on-market deals, etc.
Purchase a home
A contract was approved? Great! What’s next?
Lenders for investment property typically move through the procedure considerably more quickly than lenders for homeowners, but it still takes time. Then, take into account employing a home inspection. Home inspections are quite thorough and take several hours.
While more seasoned flippers may search for properties that require a total renovation, in the beginning you should stick with cosmetic improvements and repairs. Verify the building’s structural soundness and the efficiency of the mechanical systems.
Walk through the property with a few contractors after making sure there are no unpleasant surprises there. Obtain many quotations from different contractors to get a sense of how their approaches differ.
Select a contractor and have them begin the project the day after you purchase the property.
After you’ve settled in, get to work!
You start working on the hour on day one. You are paying interest and other carrying costs, such as utilities, insurance, taxes, and any other expenses associated with owning that specific property, every month.
To put it another way, that is lost money! The sooner you can sell the house and pay off your loan, the sooner you can finish the restoration job. And the quicker you receive payment while cutting down on the fees associated with house flipping.
Successful home flipping is often a test of productivity. The common response from contractors is, “Oh yes, we can finish this project in a week!” They continue to fiddle with the drywall a month later.
The cost of the project is the same. Midway through a renovation project for a house flip, far too often contractors want to increase the project’s cost without your consent.
This is just another justification for careful contractor selection. Call as many references and previous clients as you can if you have never dealt with a contractor before.
Market your property that needs work
Selling a home is typically the final and simplest step in home flipping.
This is primarily handled by your realtor, so be sure to choose one who is knowledgeable about your market. Not all real estate agents are made equal; many are part-timers or generalists who lack specialized knowledge of your particular market.
You can rely on your realtor’s pricing knowledge. Before ever placing a contract on the property, you should have acquired an after-repair value (ARV) assessment.
However, in the end, you are the one who must price fairly because your success in house flipping depends on it. Before you purchase your first investment property to flip, be sure you comprehend the principles of real estate pricing.
Financing a fix and flip in El Paso
When seeking for financing to raise the money needed to fund a property flip, a hard money loan is a fantastic choice. If your credit history isn’t fantastic, hard money loans in El Paso are the best option for real estate investors seeking for a source of funding to swiftly fix and flip a property.
As a hard money lender, 14th Street Capital has eliminated the middlemen, enabling us to provide our clients with hard money loans at reasonable interest rates and with lightning-fast turnaround times. A hard money loan can be your best choice if you’ve had trouble getting traditional loans.
You can also consider getting a loan from a bank or credit union, a peer-to-peer lender, a home equity loan, or a home equity line of credit to pay for your house flip (HELOC).
Nevertheless, fixing and flipping are difficult tasks. While it may be tempting to do it alone, you should assemble a real estate dream team that is knowledgeable about the regional market. These people ought to be a qualified private money lender, a seasoned realtor in the area, and a highly rated contractor. You’ll receive direction along the road and are improving your chances of success.
You can get help from 14th Street Capital, an experienced lender, to get a hard money loan for properties that aren’t owned by the borrower. To start investing in real estate right get in touch with us today!