Why Flipping Houses Is The Best Way To Make Money In Real Estate Investing

By Author: Simon Macharia
Total Articles: 7
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Flipping houses is often called the ticket to quick and easy cash in real estate investing. Most real estate investors fail in flipping houses because they approach the business model wrongly since they do not understand why it is the best real estate investing business model.

The following are a few reasons why you should adopt flipping houses as a business model.

1) You do not need a lot or any money of your own
Flipping houses, also called wholesaling houses, involves acquiring houses at a low price then flipping them for a higher price for profit.

You usually wholesale the deal to a wholesale buyer, usually another real estate investor.

Once you identify a cheap house, you sign a contract to buy the property. The earnest money you need for this is little, from under $100 to around $500.

The contract then goes to the title company or real estate attorney to begin title work.

As title work takes place, you get a buyer, usually another real estate investor. Depending on potential profit at hand, you then sign a second contract to flip the deal to your real estate investor wholesale ...
... buyer.

You do sign an assignment of contract where you assign the contract to a buyer. In this case the property is bought by the wholesale buyer on your behalf. In other words, you deliver the right to buy the house to the wholesale buyer on your behalf.

In general, you do an assignment of contract when you do not have a lot of money to make. The wholesale buyer will find out how much money you make in the deal.

You can also do a simultaneous closing, or double closing, where you buy the property then flip it to a real estate investor buyer. The contract you sign is one where you sell the property as the owner to the buyer.

So in this case, you do two transactions, one where you buy and one where you sell. Your wholesale buyer will not find out how much you earn in the transaction because you sell the property directly to him.

Double closing is better when your potential profits are high and you do not want the wholesale buyer finding out how much you make.

The cash needed in such a deal is just earnest money.

2) It needs a little work input
When flipping houses, you do not fix houses, the real estate investor buyer does. All you have to do is get cheap houses, then wholesale them to wholesale buyers.

3) You cash your check quickly
In general, it takes 3 to 4 weeks or sooner to get paid in a wholesale deal. S long as the title work is all done and the deal is funded, you can close it.

4) No hassles to do with management
No need worrying about tenants, you never have to keep rental properties. You do not have to worry about rehab because your real estate investor wholesale buyer is the one that does repairs, not you.

Ultimately, you will get a healthy cash flow as a real estate investor flipping.

Simon Macharia is a real estate investor in Dallas, Texas. He prefers flipping houses, running his business from his website for real estate investing that also automates is business