You Stand To Gain By Flipping Your Property
Do you wonder how legends like Donald Trump and Wang Jianlin have made billions of dollars from investing in real estate? They are amongst the wealthiest people in the world for the past several years. What makes them different? Well, they have come a long way.
But they started with small steps and their right decisions took them to the zenith of success. Here in this article, we will talk about some steps that may help you in adding substantial value to your net worth.
Flipping a property is a potential way to clock amazing returns on investment.
In a market where homebuyers are looking for ready-to-move-in properties, you have an opportunity to flip properties. What is meant by flipping? Let's take an example. You come to know about a home in your vicinity which is selling at Rs 40 lakh. The owner has plans to move to another city and he won't mind to bring the price further down in order to make a quick deal.
What can you do? Do a due diligence with the help of a professional property broker and find out the real worth of that property. If you find it worth a buy, make an offer of let's say Rs 36 lakh. Chances are that you may get the deal done somewhere around Rs 37-38 lakh.
After taking the possession of the property, add value to this property and put that up for sale in the market after three to four months at Rs 45 lakh. Even if you get Rs 42-43 lakh, that makes an impressive return on investment.
Now you would think what do we mean by saying 'add value to this property'? Let us explain.
Analyze the kind of buyers you may get for your property. If your property is near an IT zone, there is a high probability that you get a buyer from a company which is based out of that zone. Such buyers may look for some smart features like video door phone or keyless biometric entry. Today these features are available at just Rs 7500-15,000. But they add tremendous value to a property.
Besides enhancing the value proposition of a property by adding advanced features, you must first ensure that the house is kept in a completely 'ready-to-move-in' state. Make sure that:
- The house is white-washed, with no peeling plaster or wallpapers
- It is clean with no dust, dirt and rust out there
- All the water taps and drainages are in order
- Electric connections and plugs are working
- Locks, whether external or internal, are flawless and all the keys are available
- No broken mirrors, tiles, grills, furniture and fixtures are fixed. Rather get fixtures and furniture polished
- All junk materials are removed
- The home is well-lighted and sufficiently ventilated
In India, most buyers look for Vastu compliance. Therefore, if you wish to make any changes that may improve Vastu elements in the property, go for it.
All these factors, when put together, may add one to five per cent to the cost of the property. However, it can help you claim a premium of 10-25 per cent, in addition to improving the marketability of the property.
So, are you ready to start your real estate investing journey with 'flip-that-house' strategy?
Also Read: Flipping In the Real Estate Market For Gains