Flip Or Rent?
- Date: 2007-04-27 - Word Count: 360
Share This!
Flip or rent? It's a difficult question to answer. Both have some really great assets and both have some particular drawbacks. As investments go, both are excellent ways to build wealth. The main difference is whether or not you choose to go for the quick cash of a flip or building equity through longer-term ownership.
Lets investigate the flip first. The idea here is to purchase a home in need of a bit of work at a nice low price. Once you close on the home, make a list of the necessary improvements and get to work. Ideally the changes will be only cosmetic and intricate alteration of the home's structure or workings will not be needed. Good candidates for change are things like the paint, fixtures, appliances and other easily changeable things. Try putting down new floors for an added touch or refinishing existing hardwood if it possible. Another great idea is new cabinets for both bathroom and kitchen. The pros of the flip are fairly simple, it's all about the bottom line profit when the home sells. However, keep in mind that the profit will be taxed as normal income. Also be mindful that the home may not sell right away. You should investigate local real estate trends first and make sure that your property is as competitive as possible.
Renting is an entirely different ball of wax. Purchasing a property for renters is going to be quite the opposite from flipping. You do not need a property that will be attractive to buyers, rather a home with the necessary appliances and utilities that is well priced and clean. Keeping a property like this has some nice assets like long-term appreciation of the property and a monthly income. However, you must be ready to be a landlord, and be willing to wait until you have the RIGHT tenants. Also be prepared that you may occasionally have to kick someone out, be strict when it comes to rent collection and any number of other tasks a landlord is responsible for. The choice is your, but remember to be planned and ready for any eventualities that occur with either investment.
Lets investigate the flip first. The idea here is to purchase a home in need of a bit of work at a nice low price. Once you close on the home, make a list of the necessary improvements and get to work. Ideally the changes will be only cosmetic and intricate alteration of the home's structure or workings will not be needed. Good candidates for change are things like the paint, fixtures, appliances and other easily changeable things. Try putting down new floors for an added touch or refinishing existing hardwood if it possible. Another great idea is new cabinets for both bathroom and kitchen. The pros of the flip are fairly simple, it's all about the bottom line profit when the home sells. However, keep in mind that the profit will be taxed as normal income. Also be mindful that the home may not sell right away. You should investigate local real estate trends first and make sure that your property is as competitive as possible.
Renting is an entirely different ball of wax. Purchasing a property for renters is going to be quite the opposite from flipping. You do not need a property that will be attractive to buyers, rather a home with the necessary appliances and utilities that is well priced and clean. Keeping a property like this has some nice assets like long-term appreciation of the property and a monthly income. However, you must be ready to be a landlord, and be willing to wait until you have the RIGHT tenants. Also be prepared that you may occasionally have to kick someone out, be strict when it comes to rent collection and any number of other tasks a landlord is responsible for. The choice is your, but remember to be planned and ready for any eventualities that occur with either investment.
Related Tags: rental properties, rental investments, investment decisions, home flipping
Scott Baxter is a long time real estate investor and is also a real estate agent who specializes in Prescott AZ real estate. Scott's passion for real estate has enabled him to become a leading expert in relocation to the Prescott area. Contact Scott today for more information or visit him online at www.prescottscott.com Your Article Search Directory : Find in Articles
Recent articles in this category:
- 5 Reasons to Buy Jasper Real Estate
Jasper is a small town in North Georgia and it is growing rapidly. Since North Georgia Foreclosures - Ellijay Real Estate
Ellijay Georgia has always been known for it's outdoor activities and seasonal festivals. Downtown E - How to Deal With Blocked Drains
A blocked drain is an occurrence that happens eventually to all households. You may have experienced - The Benefits of Hiring a Plumbing Consultant
Your dream home may not always be brand new, with fresh paint and home essentials. There are certain - The Worst Mistake You Can Make When You Apply to Rent a Home
A whole new class of people has become renters and potential renters in America during the last thre - State of Individual Real Estate Markets
Everybody is well aware of the hit that the real estate market has taken over the past three years. - Thoughts on Avoiding the Landlord Trap
I've heard several people say they would never invest in a multifamily rental property because they - An Idea to Increase the Bottom Line of Your Investment Property
Are you pretty sure that you've already maximized the income coming from your property? If you've cl - Finding the Value of a Piece of Investment Real Estate
There is a lot of confusion about how much investment property is really worth. We'll look at three - Arkansas Land For Sale - Search Engine Optimization and Your Website
If you have Arkansas land for sale and are interested in advertising it on your website I have a few
Most viewed articles in this category:
- How High Did Home Prices Really Go
The U.S. Census Bureau released data on Tuesday that revealed where the nation's hottest markets wer - New Homeowners Tips for Household Safety
With so many items on their ¡°buying a home¡± checklist, few homeowners take into considerati - Truth About VA Foreclosures
Many people now days are finding themselves out of work and not being able to make the mortgage paym - Avoid Rookie Real Estate Investing Mistakes
When Robert Kiyosaki, author of the Rich Dad book series, bought his first property he was, of cours - Finding The Perfect Roommate On Craigslist
Craigslist, Roommates, and The Concerns Craigslist is "great" when it comes to looking for housing - The Forgotten Secret To Selling Property - Simple, Quick And Cheap
Why spend big dollars trying to get people to drive a long way to see your house, when your best pro - Get Amazing Results Selling Real Estate Online
This is the age of the internet. Why not take advantage of the widespread use of the internet to ad - Dallas Real Estate Information
In the United States, Dallas is considered as the second leading state according to the area. If any - The Largest Private Equity Indian Real Estate Deal
In the largest private equity deal won by the real estate sector, Morgan Stanley Real Estate has inv - Fractional Real Estate Ownership
Fractional ownership of vacation ski condos is growing in popularity. Park City Utah a popular ski t