Reader Question: Should I Buy a Home Now to Flip?
Apparently, there are still some folks out there offering seminars on how to get rich by flipping homes. Here is a reader question:
I am thinking of investing in real estate. A buddy of mine is telling me that I should get into house flipping, and he can help me get started if I attend a seminar. Is this a good way to get into real estate?
While it is true that now can be a good time to buy a home, it is not the best time to buy for flipping purposes. Home values are still struggling, and if you buy a home now to turnaround and sell again, you are not likely to make any money.
Right now, when you buy a home and get into a home mortgage loan, it is more of a long term deal. The home will likely increase in value, but it will probably take seven to ten years to get any real appreciation out of it.
Buy a home for investment purposes
If you have the credit and the down payment for it, you could get into real estate investing by buying an investment property. This is something that will offer you a regular monthly return (this isn’t house flipping). If you can buy a home that you can rent out to cover the home mortgage loan payments, that might be a good idea. There are some good deals on foreclosures right now, and that could be one way to create another income stream.
But beware of house flipping. With the real estate market as it is now, you are not likely to make a quick profit. Now is the time to think of investing in real estate as a long term investment.
Tags: house flipping, real estate, home mortgage loan, mortgage loan blog,
investing real estate, buy a home, real estate market
