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The House-Flipping Business: Here’s How to Make Money Flipping Houses in Nigeria.
It seems so simple! Buy a house, make renovations to it, and then resell it to make money. Real estate investing involves more.
A real estate investor who buys a house with the goal of quickly reselling it for a profit is known as a “property flipper.”
Strategies for Flipping Properties:
Investors seek out distressed homes because of the often reduced selling price, which makes these properties attractive acquisitions.
Properties that Need Renovation:
Faulty properties are always sold for a considerable price. The property will require renovations for any investor who chooses this kind of investment to make it more valuable in the market.
Properties are enhanced by investors, who then quickly resell them for a profit.
Flippers come in two types:
Retailers and wholesalers are here.
Wholesalers find attractive bargains, take on the risk, and then resell to retailers. For-profit, they essentially sell to merchants.
Retailers purchase from wholesalers, handle all repairs and sell merchandise fast—despite assuming the greatest risk.
The house-flipping business requires a high level of skill. The investor needs to be mindful of:
- A broad knowledge of the real estate industry
- Understanding of remodeling a house
- Every improvement expense needed for the renovation
- the capacity to recognize good deals that will sell out quickly
- Capacity to Bargain for Real Estate Prices
The most common error made by flippers is overpaying for a home. Working with a qualified contractor or flipper is always advised.
Getting Offers:
This entails locating motivated sellers who are open to unconventional terms and discounted prices. The majority of distressed properties have these.
Since not all distressed properties are the best deal, this is a skill that takes years to master. Working with a qualified real estate consultant is typically advised in order to assess the market and obtain the best offers.
Exit Plan:
Regaining your money and profits is the top priority for a flipper. You need to know who to promote your property to, how to sell it quickly, and how long you may keep it.
To Give An Example:
Assume you were asked to purchase a distressed duplex in Lagos’ Ikoyi neighborhood. N300 million is the asking price. You estimated that the renovations and repairs needed for this property would cost N30 million.
After restorations, it is worth N450 million. The owner accepted the N270 million offer that you made. As of right now, you must spend N300M for the property, including repair costs, and sell it for N400M.
N450M after repair. You will make between N100M and N150M in profit. Please be aware that flipping properties is a transient business.
Without a doubt, this is a fantastic company with a high-profit margin. First off, since the purchase price was less than 70% of the property’s after-purchase value, you did not overpay for it.
You have an additional option here;
Since the owner has already accepted your offer, you can purchase the property as a wholesaler for N270M. You can then sell it to a retailer for a maximum of N310M–N320M, with the retailer handling all improvements and renovations.
Here, you benefit handsomely—N50 million—because the wholesaler and store pays N320 million for the property, spends N30 million to repair it, and then resells it for N400 million to N450 million. He generates between N50M and N100M in profit for himself.
Flipping houses offers significant profit margins and often unexplored chances. If done correctly, property flipping may be quite successful, regardless of whether you want to start with an inexpensive property or one in a posh neighborhood.
If you are looking for the best properties to buy or invest in, Marock Lagos Real Estate is always willing to assist you in finding the best offers. We can assist you in locating the ideal property that fits your needs.
Reach out to begin your investing journey right now.
