Why flipping is not just for pancakes
by on 26th March 2018
Flipping, unusual verb, don’t you agree?
Do you see it as a mildly old-fashioned term of exasperation?
A loss of temper “I flipped”?
Or a term you use once a year on Shrove Tuesday?
Well at Hogan’s we have a new meaning for it.
Flipping in property terms means buying a property to sell it.
Let’s give an example: you spot a potential property for sale with us on our website, and see that it is accurately valued but perhaps needs some tender loving care.
You look at the property, make an offer which is accepted and you set about some cost-effective refurbishments: new kitchen, flooring, bathroom etc and then have two choices:
- Rent it out using our Lettings Service.
- Sell it.
There will be plenty of demand for each option.
Properties that are clean and tidy let very quickly and we will be inundated with enquiries about it. You cover the purchase costs, the improvement spend with the rental yield and longer term capital growth. That £75,000 property should be worth about £90,000 in 5 years’ time, you figure out, with modest annual increases. Longer term, even more.
The second option is flip it.
Sell it immediately for a quick profit.
Here’s a hypothetical example.
You see a property at Below Market Value of say £75,000, seek expert advice from Ian, Stephen, Nicole and Adam at Hogan’s and are told that following renovation that property could command an asking price of £95,o00.
3 months of refurbishment costing £7500 means you’ve spent around £83,000 but made £12,000 in profit in a short term project.
The key is to buy at the right price in the right area and keep those refurbishment costs as low as possible to maximise profit and improve saleability.
We can help you find the right property, advise you on improvements and likely increased value and subsequently sell that “new” property on.
What do you think?
We think it’s a flipping brilliant idea.