This is an easy concept in which the investor purchase, rehabilitates, and then resells a property at a profit. This is also termed as "flipping" a home. This process generally happens remotely, because the investor remains in his or her own home, sometimes in a locale where flipping doesn't make sense and uses the Internet to find and invest in opportunities.
The goal here is to make the procedure of investing in real estate as easy as possible, so all the investor has to do is flip a switch or "turn the key." Characteristically, then, you're buying a single-family home, fixing it up, in order to bring it in line with existing codes as well as make it more attractive to purchasers. You can visit http://www.yanrealty.com/arcadia-real-estate-agent/ to hire real estate expert in Arcadia.
Here's how it works:
- A turnkey retailer or firm purchases the property.
- One or more investors buy a share in or all of the shares in the house.
- The retailer or company "fixes up," or rehabilitates, the property to make it current and appealing to purchasers.
- Once the property is rehabbed, it's put back on the market for resale.
- As soon as a sale is closed, the investor gets his or her money back plus whatever income was earned, according to what share of the investment he or she owned.
If done correctly, this can be a very sound investment approach. You, as the investor, have earned a profit from flipping the home, and you can have as little or as much involvement as you desire. You can check this website to get some more real estate investing tips.
You can be as involved or uninvolved in the flipping procedure as you desire, helping to oversee the contractors rehabilitating the home or leaving the complete process up to the turnkey retailer.
Why not just buy a house myself and flip/rent it?
You might be thinking you can just eliminate the middleman, the turnkey retailer or business, and do all of the legwork yourself. While numerous investors do just that and succeed at it, there are certain drawbacks. In most cases, you'll end up undertaking much more work than you would as an investor.