Checklist to Flip Residential Properties

If as an investor you intend to buy, fix, and sell (known as flipping) then make sure to go through this basic checklist to avoid mistakes increase your chances of success:

1) What are the comps (comparable sales)

Your property better is much lower than similar homes that recently sold nearby.

2) What are the DOM statistics (Days on market)

You want to make sure properties do not sit for sale too long in that neighborhood. Anything longer than 90 days is a red flag.

3) What is the condition?

Make sure you understand how much the cost will be and pad it a bit because there are always rehab surprises.

4) How long will the rehab take?

Time is money when you are flipping properties. Your turn around time must be less than 6 months from closing (purchase) to closing (sale).

5) What are the prices and how many homes are listed nearby similar to the home you are planning to purchase?

You want to see what is currently listed and for how much. Your goal is to be at the lowest end on the current listings with the largest square footage and best configuration to sell fast at top dollars.

6) What is the plan with the property? (The numbers and time frame)

Make sure you have a clear plan as to what you will do with the property.

7) Do you have the means to acquire, rehab, and resell? (Cash reserves)

Make sure you have the money or credit lined up for the work and cost to complete the deal satisfactorily.

8) Do you have experience in the business?

If not, team up with a good contractor and broker.

9) Do you know that area?

If not, take the time to drive around to open houses, talk to realtors, check data of neighborhood on line.

10) Do you have a team to assist you?

Even if you are an expert, you need help and good people around you. Give them the proper incentives and be clear on your goals and time frames.

11) Do you have a plan B (i.e. keeping it as a rental or selling creatively/)

The market could change, things could run astray, so you must have a backup plan like renting the property or selling and carrying a note, etc.

12) Can you assign it? Do you have a list of cash buyers?

What if you decided to just assign the contract to someone else. Have you lined up a list of qualified investors with cash and do you know what they are looking for? Can you have them compete against each other?

There is nothing wrong about passing on a few deals until you get a sure home run. The idea is to have a low risk and high return.

Here’s to smart flipping!

Cherif Medawar

CMREI.com Founder