The vast majority of people, particularly those who are new to real estate investing, opt to buy cheaper homes with the goal of a quick fix-and-flip. Though, the massive influx of flippers has reduced the number of “reasonably priced” properties available for a quick flip. As a result, some real estate investors are now turning to flipping luxury homes that require a larger upfront investment but could provide an even bigger payoff at the end of the day.
In order to successfully flip a luxury property, it is critically important to consider the following issues and take certain steps to maximize value:
1. Secure the Right Financing
The vast majority of home flippers do not have the resources to cover the cost of all the necessary expenses to properly renovate a luxury property. Hence, securing the right financing is critically important to ensure your success.
Unfortunately, getting financing through traditional methods – such as a bank or credit union- can be extremely difficult, if not downright impossible. This is especially true for someone looking to purchase a luxury home that will need to be renovated and flipped. As a result, you should consider working with a hard money lender in Los Angeles. Why? Because hard money lenders are generally much easier to work with, will assess a loan application holistically, and can generally make a decision in a matter of days, not weeks or months.
Once you secure the right financing for your luxury real estate flip, the next step is to work on budgetary issues.
2. Set and Stick to a Budget
While budgeting is an important aspect in all real estate investing, it is especially important for luxury house flipping. When you are in the luxury housing market, the pool of buyers are typically more demanding and could be more difficult to please to the point where your property can sit on the market for weeks on end.
Hence, you need to be able to create a budget that will enable you to make all the renovations necessary without neglecting the details. You need to be prepared to continue making payments on the home for an extended period of time because homes on the luxury market oftentimes do not sell as quickly as homes with lower price points.
3. The Details Make All the Difference
Details, including even relatively minor details, can make or break a sale. Buyers in the luxury housing market want “the best” which is why you should not hold back when updating the kitchen and bathrooms in the home for example. Top-of-the-line upgrades with the highest quality materials will likely go far in improving the chances your home sells sooner rather than later. Obviously, this means you need to be prepared for a higher cost for the renovations; however, provides the power to sell the home at a much higher price.
Interested in Working with a Hard Money Lender in Los Angeles? Contact PB Financial Group Today
If you are looking to secure a hard money loan for a real estate venture, take action by contacting PB Financial Group today. PB Financial Group is a premier direct hard money, private money and bridge lender, who has been providing quick funding since 2006 and have funded over 2700 hard money/private money loans. Our objective is to work to satisfy your financing needs on important real estate projects throughout California in an efficient and effective manner. To schedule a consultation please contact PB Financial Group at 877.7003707 or visit www.CalHardMoney.com for further information.
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