How to Make Money Flipping Houses By Simon Macharia At Isnare.com Ezine Articles

One of the fastest ways to make money in real estate is through flipping houses, which is also referred to as wholesaling houses.

It is also the real estate investing model that probably requires the least amount of work and cash invested into each deal.

Flipping houses involves locating houses at below market prices, then "flipping" them to other real estate investors at a discount.

Most of these properties come from distressed home owners (motivated sellers), such as home owners facing foreclosure, going through divorce, job loss, job relocation, illness, or simply cannot afford to keep making mortgage payments.

Sometimes they just need to get rid of the house, but cannot afford to do the repairs needed, or simply don't want to do it. They therefore accept to sell the houses at a discount for a quick and easy closing.

When you flip a house, the profit may not be very big (such as when you sell at retail), but you make your money fast, typically within two weeks.

The process goes something like this:

1) Real estate investor locates discounted property from a motivated seller and puts it under contract

2) He then takes this contract to the title company to get the title work done to ensure the property will be delivered free and clear

3) Another real estate investor (wholesale buyer) acquires the house through one of two methods:

a) He takes over their contract for an assignment fee and closes on the property himself or

b) He buys the property from the investor in a double closing (simultaneous closing). In this case you buy the property and sell it to the wholesale buyer on the same closing table.

The wholesale buyer ends up doing most of the work (such as repair) and makes more money eventually after they fix and sell.

You as the real estate investor flipping the house have to leave more money on the table for the wholesale buyer.

Typically, you must locate properties for sale at 65% of market price minus repairs or less if you are to wholesale a deal successfully. Most wholesale buyers will express less interest when the profits go below this figure.

You must then quickly find wholesale buyers with cash in order to flip your property quickly.

Finding buyers often involves a combination of methods, both online and offline. The more methods you can employ, the more likely you are to find a cash buyer.

Offline methods include advertising the property to local real estate investors in local newspapers. I always make sure to give them my web site, rather than my phone number. Using a well designed landing page (squeeze page), they have to give me their name email and phone number before they can access my deals - building a very powerful buyers list.

The first thing I do is to email my deals to my buyers list, a list of active real estate investors I have accumulated both from local REI meetings and my website.

Each person inevitably ends up on my web site to view the full details of the property such as comps, live video vitual tours and pictures. In the process, they can email this deal to their friends exposing the deal to more potential buyers.

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