Flipping mobile homes is common. Some real estate investors consider it a great entrepreneurial prospect. Many people make a profit out of it primarily because mobile or manufactured homes are much more affordable than traditional homes. However, flipping mobile homes is not without challenges, and it is certainly not for the inexperienced.
Here are the things to bear in mind before considering flipping mobile homes, so you do not end up burning your fingers.
Set a Budget
Before you set about looking for mobile homes on sale for buying, it is essential to have a budget. Bear in mind that the budget does not mean the amount that you can afford to pay to buy a home. Instead, it is the maximum amount that you’re willing to spend on it before putting it up for sale. Unless you do that math, you’re likely to overspend on improvements.
For instance, if you’ve bought a house for $40,000 and spend another $15,000 on its improvements and ultimately you end up selling it for $65000. So, you haven’t made any profit because the cost of renovations has offset it. When you’re checking out houses for sale, check how much work it needs on the interior and exterior.
Identifying Homes with Resale Potential
Ideally, you want mobile homes at the cheapest rates that have resale potential. Your best bet would be houses that are yet to hit the market or those that have just hit the market or even properties in the foreclosure stage or pre-foreclosure stage. If you’re a seasoned flipper, you should estimate the repair costs when you first view the property. If you do not have that kind of experience, it is a good idea to get an experienced contractor to help you with the task.
Know What Repairs Cost
If you are working with a contractor, it’s well and good. But, if you’re planning to get into the game, it is great to have an idea about the standard repair costs like roofing, electrical, plumbing, water supply, pest infestation, heating, and air conditioning systems, etc. You have to get the certificate of occupancy from the local county before you sell the property.
Which Improvements are Worthwhile
When you’re flipping mobile homes, the goal is to make the house appealing to potential buyers. Simple changes like a fresh coat of paint, fresh floor carpet, changing the fittings and fixtures, etc. can make a lot of difference. It is vital to keep your budget and potential profit you expect to make in mind. There are several DIY home improvement ideas online that you can use and save money.
Pay Attention to the Structure
When we’re talking about mobile homes, it is essential to note that the house should be structurally sound. Structural repairs can prove to be very costly and, therefore, not worth the investment.
Flipping mobile homes is not for everyone. You have to be familiar with all aspects of its construction. The value of mobile homes does not appreciate as that of the traditional real estate. However, if taken good care of, it can fetch high returns.