Advise on first time condo flip

[Jaylyn Heartso]

Hi everyone! I am pretty new to the biggerpockets site so I wanted to reach out and get some advice. I am in the Denver area and am looking to do my first flip. My plan is to get a hard money lender and buy a foreclosed or discounted condo. I am hoping to fix and flip it by the end of the summer and make a profit. Thankfully, my husband can pretty much do all the repairs needed so that is helpful. Has anyone done this before? If so, what was your experience and would you recommend doing this to start out? Thanks for any input! I really appreciate it.

[Dan Mackin]

There are lots of folks doing this to start out. It's a lower barrier to entry so it can be a little more reasonable to get into. When you're purchasing a condo you'll want to be sure that your end buyers are more available. 3 major things to look at.

1. Location as with any property

2. ARV as with any flip

3. This is the one many people don't think about. Condos generally appeal to the first timer market. Lots of these folks will be using loans such as FHA, VA, etc. With those loan types there are certain restrictions in place. For instance FHA will not lend on non-warrantable complexes. This means that a certain percentage of the complex is owned by non-owner occupants or that one owner owns more than a certain percentage. When purchasing find out if the complex is FHA compliant. If it isn't it could dramatically lower your buyer pool. Same goes for VA. The complex needs to be registered with the VA to be eligible for a VA loan.

Not saying number 3 is a deal killer, but it can sweeten the pot. If you're looking at 2 properties and one is FHA compliant and the other is not, go for the FHA compliant if the numbers are similar.