Flipping in a Changing Market

Ever heard the expression "Get in on the Ground Floor." What exactly does that mean? In the housing market it doesn't mean getting a great first floor unit, or waiting until there are 10 different Cable TV shows covering the new "flipping" market.

Despite what the media says it is quickly becoming a buyers market in some areas. Homes can be bought "cheap." I am not sure how buying a cheap house, fixing it up & then trying to sell it can be profitable in this market. I have now seen several "Flipping" shows where the owners have made terrible mistakes costing them their potential profits. I feel like I am watching the big game shouting at the TV "Get an agent" "what are you thinking, putting assemble yourself cabinets under a granite counter-top, who does that?" & "why are you paying $500,000 for a 1 bedroom 1 bath house you are going to flip?" "why haven't you rented it out, it's been vacant for 6 months?" I am a lot of fun to watch TV with!

I can tell you that where I live the housing market is different & the prices are relatively lower than the norm on these shows. There isn't a huge influx of new people & the houses themselves are older. I have literally fallen off the couch at some of the prices they throw around on these shows. I can tell you that I could completely gut my house, remodel it & buy 2 more of them with what a two bedroom duplex costs in some parts of the country.

I have been watching our local tax auction & foreclosure lists closely. The area is maintaining, I don't feel that it is declining or booming at the moment, but the second it starts to decline there will be a ton of homes to be had at rock bottom prices. I do not ever dream that I could make $100,000 buying a home in our area & flipping it. We have been looking at our options and I believe the option for us is to partially flip. We can buy a home on the cheap, fix it up (bring it to code, update a few fixtures, etc) then rent or lease it out. Our area is attractive to renters, low utility costs, and semi attractive to buyers, low utility costs, but high property taxes.