Four Moneymaking Tips to Consider Before Flipping a House
(NEW YORK) — Dave Seymour of the A&E reality show Flipping Boston has become famous for buying homes, renovating them and selling them within months for a pretty profit.
“What I do for a living, it’s an economic stimulator in and of itself because it’s properties that move our economy,” he told ABC News. “Real estate is what moves our economy, so we’re proud of that.”
Seymour, a former firefighter, fell on hard times in 2007 and started flipping homes in Boston at the exact moment when home values were tanking. Now, his company, CityLight Homes, which he runs with business partner Peter Souhleris, has a dozen homes in the process of being flipped.
According to RealtyTrac, flipping is making a comeback in this housing market. The market is currently on track to hit record highs this year, up almost 20 percent from last year.
Nationally, flippers are making an average of nearly $18,391 a sale. Seymour said he shot for a 20 percent profit on each house and generally spent about four months on each home, from acquisition to sale.
Seymour cautioned prospective flippers to educate themselves first.
“If you’re just doing [one or two homes] a year — and you’re playing at this thing — you can get seriously hurt,” he said. “There are always, always surprises. Sometimes, I do a little bit better. Sometimes, I don’t do quite as good.”
He said the biggest money pit he’d gotten himself into included a septic system that cost $45,000 to repair.
“You got to know what you’re doing,” Seymour said. “You don’t do this on a whim.”
He shared these four tips to increase the value of a home being flipped:
- Crown molding, for about $200, can dramatically improve the look of a room.
- A new garage door, for about $2,000, can increase the sale price by $8,000 to $20,000.
- Try a new front door as an inexpensive way to up curb appeal. Seymour said he liked to always do his in red.
- Always list properties Tuesday night. By the open house on the weekend, there’s already some buzz — and more people at an open house creates competition.
Copyright 2013 ABC News Radio