If you love watching house renovation programmes and are dying to get your teeth stuck into property makeovers that could make you some money, you may want to consider house flipping. With new tax laws now in force in the UK, flipping – the process of buying a home with the intent of selling it on – is likely to become even more popular. This is because new tax laws will remove buy-to-let landlords ability to claim tax relief on mortgage payments, combined with a reduction in the level of allowable costs landlords can write off for tax purposes.
You don’t have to have your own property portfolio to get into flipping, though. In fact, from a tax point of view, it will work in your favour if you actually have only one home and live in it while you do it up, before selling it on for profit. With this in mind, today we’re talking about how to access how ‘flippable’ a home might be along with the top five must-haves of properties that are easy to pass on.
Why house flipping?
Flipping is an American term for buying a house in order to sell it on for profit. Most often this is done as fast as possible so that the purchaser can move on to their next project. However, with many homeowners in the UK increasingly forgoing buying their forever home so that they can simply get a rung on the property ladder, many are finding that they want to flip their first home in under five years in order to move on to the next home.
This involves buying homes that need a little work done they can perhaps afford to live in a slightly nicer area. The aim is, therefore, to identify somewhere you’d be happy to call home for a few years (or months if you’re working shorter term) that should be easy and profitable to sell on.
4 features of flip-worthy houses
Firstly, the first thing to recognise is that while there are some features that will make a property generally more flip worthy, how important they are or even how you present them will depend entirely on your target market. So, if you were aiming to flip a family home in an area where lots of families live, you’d install different upgrades in comparison to the renovation of a home aimed at retired couples.
Here is a good list of features that are important to property buyers but are four key features that help homes sell:
You really can’t underestimate the importance of location, location, location when it comes to making a home flip worthy. A property being well-placed next to good schools and other amenities is always a strong selling point. Next up you need to consider what physical issues could be off-putting to potential buyers. This means addressing the basics such as ensuring plumbing and electrics are in good working order and that building or damp problems are rectified. Finally, desirable décor that is neutral enough to appeal to a wide range of buyers is another great selling tool.
If a kitchen needs work a buyer will mentally knock the cost of installing a new kitchen off the price they are willing to pay for a property. If the current kitchen is looking tired and you can’t afford to replace it, strongly consider at least refurbishing cupboards and refinishing flooring or re-tiling. The heart of the home is a great area for incorporating upgrades that will strongly appeal to your target buyer.
This could be as simple as considering the position of the oven so that it’s out of the reach of little ones or conveniently placed for those who aren’t as good at bending as they used to be. Installing bi-folding doors that back onto a garden is a great way to appeal to growing families who love entertaining. Check out Vufold for some style inspiration.
An ageing bathroom can be an instant sale-price cruncher, though fitting a whole new bathroom won’t necessarily be the best option in every case. In fact, sometimes it’s the number, rather than the style of bathrooms or toilet facilities that can up a home’s desirability factor. Those searching for a potential family home frequently expect to have a shower. A bath within the main family bathroom and an en suite or an additional W.C. often make their way onto the must-have list too.
Many households now have two cars or more, which means practical parking is a priority for many. Whether it be a garage, driveway or permit spot at the front of the house, homeowners often see having a place to park the car as non-negotiable. So, if you’re considering converting the garage into an extra bedroom, you’ll need to be sure you have great parking facilities elsewhere to make up for it.
That said, being able to boast an extra bedroom could help your property get noticed by house hunters who are searching for a home with a minimum number of rooms, so the ability to extend or convert is always something to keep in mind.
Have you ever intentionally or unintentionally flipped a house? What are your tips for purchasing and improving a house so that it will be more flip worthy in the future?