A Beginner’s Guide to Real Estate Flipping in the Willamette Valley
After all the TV shows and crazy tales of fortunes made and lost in flipping, I decided to share more about the world of real estate flipping here in the Willamette Valley. Flipping houses can be rewarding, but it has challenges and risks. I consider the four hardest parts to be finding the property, estimating renovation expenses, financing the purchase and renovations, and finding reliable contractors. I’m here to share what I’ve learned from our investment group.
Top Tips for Beginners
Before going too far, I highly recommend the following:
- Don’t bite off more than you can chew. Meaning if you don’t have considerable construction experience, start with a light fixer. Paint, light fixtures, flooring, new roofs are relatively simple and easy to budget. Pass on a project with moving walls, foundation repairs, and “gutting.”
- Bring a stager, experienced flipper and/or Realtor to the project right away. They can help you decide which renovations to do for best ROI, what to skip and red flags at the property.
- Have a home inspection done prior to purchase. Know what you are walking into.
- Sell on the market with a highly experienced agent for the highest price. Your agent should also be able to help you with many parts of the process – finding properties, calculating ARV, connecting you with contractors and stagers and marketing the property for maximum sales price.
Section 1: Getting Started with Real Estate Flipping
Real estate flipping involves purchasing properties, improving them through renovations, and selling them for a profit. It’s crucial to understand the market, be able to estimate the budget, and find the right property. One of the significant changes in our local market in Corvallis, Albany, Lebanon, and Philomath areas is that buyers strongly favor renovated and staged homes over fixer-uppers or homes with dated interiors.
Section 2: The Flipping Experience
After slowly building your confidence, realize that the first foray into flipping will teach you more than you would imagine. Be extra careful with due diligence. Analyze, price, research and talk to everyone: neighbors, city and county. understand everything about zoning, HOA’s, and regulations for the area.
Section 3: Finding the Property
Finding the right property is a blend of strategy and networking. I recommend defining your criteria, including location, price point, and general property condition and then spreading the word. Networking with local agents, friends, family, community groups, etc, is where most people get their first deals. Also, connect with wholesalers and other local investors about your criteria. Lastly, consider contacting homeowners that fit your criteria through direct mail or other means, focusing on those with “distressed” properties. Remember, the goal is to meet the 70% rule – not spending over 70% of the property’s after-repair value on the purchase and renovations.
Section 4: Estimating the Renovations & Expenses
Estimating costs accurately comes with experience, but there are tools to help. I like online estimators like Kukun for renovation expenses and DealCheck.io for a detailed analysis. Hiring a stager, like Margaret Oscillia from Creative Concepts, provided invaluable insights into high-ROI renovations, estimates and contractor connections. Getting a paid estimate from a general contractor can also help in budgeting accurately for your first few projects.
Section 5: Financing the Purchase
Funding a flip can be done through various means – savings, HELOCs, loans from friends and family, hard money lenders, or partnerships with the seller through “creative financing.”
Section 6: Finding and Managing Contractors
Having a reliable network of contractors is crucial. The Sue Long Really Group maintains a Vendor Book of top-notch local companies in the Willamette Valley that we are happy to share. For beginners, hiring a general contractor can simplify the process. Recommendations from friends, family and your community are great, but verifying license and bonding status is an essential step. This can be done at https://search.ccb.state.or.us/search/
Section 7: Selling the Flip
The key to selling a flip for maximum price is broad, rapid market exposure. Listing on the MLS is recommended for that reach. Working with an experienced Realtor, like myself and the other members of the Sue Long Realty Group, ensures a smooth process and broad exposure. Investing in professional staging and photography showcases the property at its best.
Conclusion
Flipping a property in the Willamette Valley is a journey filled with learning opportunities. Check out the listing of my latest flip (<<insert link>>) for a real-life example. Stay tuned for updates on the sale and future projects.
Interested in real estate flipping in the Willamette Valley? Contact me for more information or consultation. Whether you’re in Corvallis, Albany, Lebanon, or Philomath, we’re here to help you succeed in your real estate investment journey.
Links-
Ryan Long – ryanlong@kw.com or 541-745-9470
Sue Long Realty Group Vendor Book: email us at thesuelongteam@kw.com
Margaret Oscillia at Creative Concepts: https://www.stagingoregon.com/
Kukun (renovation estimates): https://app.mykukun.com/Home-Renovation-Costs
DealCheck.io (deal analysis): https://dealcheck.io/
BiggerPockets.com Calculators: https://www.biggerpockets.com/investment-calculators
Oregon CCB (contractor verification): https://search.ccb.state.or.us/search/