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How to make $1 million ‘flipping’ houses

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How to make $1 million ‘flipping’ houses

HIS last property sale earned him a tidy million-dollar profit, so it’s safe to say when it comes to “flipping”, Tom Hall knows his stuff.

The Melbourne man has been flipping property for 16 years, and has 10 successful “flips” under his toolbelt.

The Brighton property before flipping. Picture: Supplied

The Brighton property before flipping. Picture: Supplied

For the uninitiated, flipping refers to profiting from real estate, either by “buying low and selling high” or buying a run-down home and renovating it for profit.

Mr Hall, a former electrician and real estate agent, ventured into the world of flipping when he bought his first property at 24 for $124,000, renovating it before and after work and on weekends.

He more than doubled that investment when he sold it a couple of years later for $265,000 after shelling out just $14,000 in renovations – and his love affair with flipping began.

Knowing he was onto a winning formula, Mr Hall went on to purchase bigger, more expensive properties each time, culminating in the most recent sale of a Brighton property which he bought for $1.35 million, and sold for $2.35 million 18 months later.

Mr Hall transformed the four-bedroom home. Picture: Supplied

Mr Hall transformed the four-bedroom home. Picture: Supplied

In the early days, Mr Hall and his wife Alicia used to brave the “dust and dirt” and live in each property during the renovations.

With two young boys, that’s no longer possible, but today Mr Hall runs his own renovation business, Overhall Your Property, alongside his flipping passion.

“I’m a visual person and to see the property go from nothing to something amazing gives me a thrill,” he said.

“It can be a bit stressful – it never stops and it’s very consuming.

“But I wouldn’t have it any other way. I wouldn’t want to do anything else.”

Mr Hall said a successful flip came down to meticulous market research and the ability to do most projects yourself.

When he bought it, the bungalow was looking a little run-down. Picture: Supplied

When he bought it, the bungalow was looking a little run-down. Picture: Supplied

But is flipping always a sure-fire cash-cow?

New analysis from CoreLogic revealed 90 per cent of flipped properties sold last year made a profit – but as house prices ease in Melbourne and Sydney this year, a rise in loss-making flipped properties is expected.

“Although the proportion of flips at a loss has declined from recent highs in 2009 and again in 2012, there has been a clear increase in loss-making flips recently,” CoreLogic’s Property Flipping Report stated.

After flipping, it was transformed. Picture: Supplied

After flipping, it was transformed. Picture: Supplied

Nevertheless, while Mr Hall agreed property prices had already cooled slightly, he said there were still plenty of opportunities to make decent money flipping.

He said lower house prices could even help flippers enter the competitive housing market.

“If you put the right product to the market and keep the purchaser in mind you’ll have no problems selling property,” he said.

“The whole idea of owning your own home and renovating it is a big Australian dream – everyone wants to own property.

“There’s definitely still a future in it.”

The house was in need of a makeover. Picture: Supplied

The house was in need of a makeover. Picture: Supplied

So how do you make it in the flipping business? Mr Hall shared his top tips for flipping success.

DO YOUR RESEARCH

“If you’re looking to buy, educate yourself on the market – entry price is the most important thing. If you pay too much getting in, you won’t make dollars and cents at the end. I read heaps of books, and really annoy real estate agents on trends and what’s going on in the market. I always hassle them because they’re pretty much three months ahead of the market – they see what’s going on in the market before it hits the papers,” Mr Hall said.

“The main thing for me is getting in at the right price. Keep an ear to the ground in your market and don’t look at 10 different suburbs, look at two, otherwise you’ll just confuse yourself.

It’s now a stylish residence. Picture: Supplied

It’s now a stylish residence. Picture: Supplied

“On my way home I always drive a different way so I can see what boards are up and what’s going on. I’m a bit nosy, but you have to be if you want to do this seriously.”

START SMALL

“I have flipped 10 different projects varying from smaller properties and apartments to bigger houses. I really built my way up from something small into property worth millions now, and the way to get into it is to start small and learn from there – I’m self-taught.”

DO IT YOURSELF

“Hiring tradies can really chop into your budget. If you can always build on your skills and learn you will save yourself a hell of a lot of money, so the more you can do yourself the better off you’ll be at the end. Always use a licensed plumber and electrician, but for example if you have someone doing rendering, hang around and learn about a trade if you’re not experienced in it, so next time you can give it a go yourself and save big money.”

Nearly nine out of 10 ‘flipped’ properties sold last year made a profit. Picture: Supplied

Nearly nine out of 10 ‘flipped’ properties sold last year made a profit. Picture: Supplied

INVEST IN A GOOD FOOTPRINT

“My strategy is always renovating what is there – I’m not a new-build man, I’m an add-value man. I try to utilise the home’s footprint to add value. You’ve got to have a bit of forward thinking in terms of what you can do with spaces.”

KNOW YOUR BUYER

“Have a target market in mind. Whether it’s a family with children or a young couple, you need to do your research and tailor your design towards the purchaser. That’s the end game – it’s not necessarily for you, it’s about getting a sale from the right purchaser who will pay the highest price.”

CoreLogic predicts a rise in loss-making flipped property this year. Picture: Supplied

CoreLogic predicts a rise in loss-making flipped property this year. Picture: Supplied

Originally Published: sunshinecoastdaily.com.au

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Five Brisbane houses under $500,000 ripe to renovate to perfection

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Brisbane apartment valuations on the slide with thousands more units on the way

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Brisbane apartment valuations on the slide with thousands more units on the way

The large number of newly completed apartments – about 8300 – expected to hit Brisbane in 2017-18 will only worsen the problem, DFP says, quoting the latest residential data from property research group BIS Oxford Economics. A further 5000 units are in the pipeline for 2019. Yongyuan Dai/IStock

Mortgage revaluations of second-hand homes in inner Brisbaneare between 20 per cent and 30 per cent lower than the prices they originally exchanged for, one more sign of falling demand and over-supply in the Queensland capital, according to private property lender Development Finance Partners (DFP).
DFP, which provides commercial loans to residential developers, has discovered that not only are the values of new dwellings being pushed down, but secondary apartments and townhouses have been swept up in the downward slide.

The large number of newly completed apartments – about 8300 – expected to hit the city in 2017-18 will only worsen the problem DFP says, quoting the latest residential data from property research group BIS Oxford Economics. An additional 5000 units are in the pipeline for 2019.

According to BIS, the average number of apartments constructed in inner Brisbane outside of a boom year is about 2000.

DFP believes, based on information provided by its clients and industry experts, that the Brisbane apartment market will be further “tested” in the last half of the year.

“It’s a shock and it pressures those owners who do not have substantial equity,” DFP director Matthew Royal said.

“The new, shiny, state-of-the-art properties are easier to let and those owners, keen to get cash flow, may set a rental that is lower than rentals applying for nearby, older, properties.

“Making things worse is that, in a new development a large number of rental properties emerge at once, flooding the market,” Mr Royal said.

Adding to the woes of lower rents, banks are refraining from refinancing interest-only loans, forcing many borrowers to repay both principal and interest.

“Lower rents push down a property’s value, reduced cash flow arrives as principal and interest needs to be paid and an investor, financially comfortable up until then, is suddenly struggling to ‘hang on’,” Mr Royal said.

Additionally, Mr Royal is predicting more time on market for re-sales of apartments from the third quarter of 2018 onwards.

“Unfortunately I am predicting more pain than gain for the most exposed assets this time next year.”

It’s been two years since concerns about an oversupply of apartments in Brisbane began but many developers are understood to be still holding onto stock, hoping the dwellings will be absorbed by a growing population

This expectation of a gradual correction is supported by the relatively flat – as opposed to rapidly falling prices of Brisbane off-the-plan units, shown in settlement data from Corelogic.

But there are fewer projects in the city, with just 12 launched in 2017 compared with 57 in 2016.

Source: www.afr.com

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Hamilton Hill home of NASA inventor for sale for first time in half a century

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Hamilton Hill home of NASA inventor for sale for first time in half a century

This home at 29 Queens Rd, Hamilton, is for sale for the first time in over 50 years.Source:Supplied

THE Hamilton Hill home of a Brisbane inventor who helped put NASA into space has hit the market for the first time in more than 50 years.

Norman Flournoy, 88, has 27 worldwide patents to his name, including technical inventions used in ballistics and rocketry in the United States.

His wife, Marea Reed, worked from home as an optometrist for three decades and still has the original chair she used, which was made in 1876 from solid brass and bronze.

The 79-year-old hasn’t ruled out selling the chair with the house, but stressed it would have to be a good offer.

Hamilton Hill home of NASA inventor for sale for first time in half a century

The view from the back deck of the home at 29 Queens Rd, Hamilton.Source:Supplied

Mrs Reed moved into the home at 29 Queens Road in 1965 with her first husband, who was an architect.

“It was a wreck when we first came here,” she recalls.

“He did some beautiful, sensitive alterations to the house.

“It’s a wonderful mix of the traditional colonial and the new avant-garde.”

Perched high on Hamilton Hill on 890 sqm, the six-bedroom, two-bathroom colonial home is the perfect renovation project, offering spectacular river and city views.

Hamilton Hill home of NASA inventor for sale for first time in half a century

The living room in the home at 29 Queens Rd, Hamilton.Source:Supplied

“It’s got an absolutely fantastic view and position,” Mrs Reed said.

“What I love about it is the great expanse of sky.

“It’s a very happy home.”

Traditional features include a wraparound entry veranda, original timber flooring, wide hallway and VJ walls.

There is a large back deck, which extends off the living and dining area that would be perfect for alfresco dinners or parties.

Hamilton Hill home of NASA inventor for sale for first time in half a century

The hallway in the home at 29 Queens Rd, Hamilton.Source:Supplied

It overlooks the backyard, which allows plenty of room for a pool or home extension.

Underneath the home is a spacious studio with bedroom/lounge area and kitchenette — ideal for a guest wing or teenage retreat.

Marketing agent Nick Kouparitsas of Ray White Ascot said it was rare for such properties to be offered to the open market.

“We don’t come across too many of these homes that have been in the same family for so many years,” he said.

“Around Hamilton they’re pretty rare.”

Hamilton Hill home of NASA inventor for sale for first time in half a century

One of the bedrooms in the home at 29 Queens Rd, Hamilton.Source:Supplied

Mr Kouparitsas said he had fielded interest from local and interstate, mostly from owner-occupiers looking for something to renovate on a large block in a great location.

“You’ve probably got some of the best views in Brisbane there of the river and the city,” he said.

The property is scheduled for auction on-site at 4pm on May 26.

Source: www.news.com.au

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