Why flip foreclosures?

[Arturo Borges]

Hey!

I would like to get some input on why flipping foreclosures can be good, being objective, what are the pros and cons?

Thanks!

[Brian Adzadi]

@Arturo Borges

Because it plays on the fundamental rule of being successful in business, "Buy low, Sell high". Most times you are buying these properties for just a fraction of their original worth. You fix it and flip it, now you can sell it back for 3-4x what you bought it for.

The cons about flipping foreclosures is, depending on the county or state, you will be buying it sight unseen. You don't get the luxury of walking through the house and see what needs to be repaired or remodeled. So you never know how much money you need to have to make it sellable until you actually purchase the property.

Another con is you have to make your own speculations about the area to determine if its worth flipping. Lets say you bought a foreclosure for 50K and put in 20K worth of work in it. Now you think it should sell for at least 90K but the city decided to place half-way houses in that area where the dredges of society will be gallivanting around your property. Do you think you can still sell that house for 90K? I think not.