For those who have been successful with flipping real estate in Ontario, they have found there is a loose formula to making a profit. Of course, luck where the market is concerned plays a small part given how it fluctuates. However, they will say that the biggest contributing factors to creating the formula for profitable real estate investing, particularly flipping houses are as follows:

• being armed with a firm, but practical budget hand,
• mapping out a reasonable timeframe
• saving money as much as possible WITHOUT cutting any corners, and;
• make sure to do due diligence where research is concerned,

A Firm, but Practical Budget

With any venture, there is the potential for loss due to unforeseen circumstances. It’s a gloomy way to look at it, but the most practical approach as well – it means that one must always be prepared to lose their investment, therefore one should never put up more money than they can afford to lose. Once this amount is decided upon, then the budget can be segmented to include the most important factors such as purchasing costs, renovation costs, selling costs and contingency costs.

Mapping Out a Reasonable Timeframe

The timeline for flipping real estate in Ontario will depend on the type of property. For those inexperienced or new to the house flipping type of venture they may be under the impression (thank you, Home and Garden TV) that the process simply consists of purchasing an older home for way below market value, doing some creative, but frugal DIY (Do-it-Yourself) upgrades and selling it a few months later for twice what was paid. IF there is any realism in that scenario at all, it would be to show what happens when someone wins the house flipping lottery.

Realistic house flipping consists of purchasing property, and selling it at a later date, with the average goal being to be able to sell for 10% more than the purchase price. The amount of work to increase the value of the house will determine what a reasonable timeframe should consist of. Some properties won’t even need work for resale, they just require the investor to sit on it until the market is more favourable.

Saving Money as Much as Possible Without Cutting Any Corners

As mentioned, the myriad of home and garden TV shows will lead the public to believe that with a few cute and cheap DIY fixes, a house can be flipped quickly for an exorbitant amount of money. DIY, however, unless someone is a trained professional, should be avoided at all costs. This type of corner cutting could end up costing more money. The truly more cost effective option is to ensure that only verified professionals are hired for any time of renovation efforts. This will ensure that all repairs and upgrades are completed correctly, and on time.

A creative approach for saving money , that might not be obvious is to look at Cashback options for anything needed to be purchased for the real estate flip. One innovative company even offers real cashback rewards dollars when professional services like buying and selling real estate or arranging mortgages. Any cashback earned can be reinvested in the project and thus becomes savings.

This company, called Shop2Svave is not a real estate company nor is it a mortgage brokerage, rather they a powerful volume buying platform that services its members with two of Canada’s most trusted companies; Remax and Dominion Lending Centres National. Traditional cashback mortgage arrangements are a poor choice for real estate flippers, because the cashback is on condition that there will be financial penalties to changing the terms of the mortgage. As the goal is to sell the property as quickly as possible this causes obvious problems. Shop2Save cashback is real rewards cashback dollars that are not subject to any fees or strings whatsoever.

Due diligence where research is concerned

There’s a lot of research that should be completed prior to engaging in the business of flipping real estate in Ontario. Luckily, hiring trusted professional can make this exponentially easier. Real estate agents can assist with location scouting, area demographics, historical and projected market trends and more. Mortgage agents can assist with finding the best rates possible.

This is especially important should the property not sell as quickly as expected and the mortgage needs to be carried for a few months. Reputable contractors can provide estimates for renovations as well as the length of time required to complete them. Shop2Save has an online proprietary calculator to determine eligible cashback amounts that can be earned when buying or selling real estate, or when mortgages are arranged.

Find success with flipping real estate in Ontario. A realistic budget, practical timeline, saving money without cutting corners and having professionals assist with researching the many aspects essential to real estate investments is the formula to follow!