Flipping Houses Without Flipping Out 

 You’ve probably seen television programs or heard real estate moguls touting “flipping houses” as a means to make a profit in the real estate market. Flipping a house is when a person buys a house at below-market value, invests money in the property to repair and/or update it, and then sells it at a profit. Simple, right? The TV shows and real estate tycoons make it seem easier than it often is in real life. There is risk involved and the process can be stressful, especially if you don’t have a team in place to help you flip the home. 

The most valuable player on your team should be a realtor—and not just any realtor, but one who Is qualified and who prefers to work with investors in the market, not just those desiring to purchase a home, and who has the experience and expertise to help you flip a home successfully. While you need contractors, plumbers, electricians, etc., you need a qualified realtor first because the costliest mistakes often occur at the time of purchase of a property. The most important tool when flipping a home is to know the real estate market in your area so you don’t overpay, and a realtor is the one who has the latest and most extensive information on the housing market because they have access to the Multi-List.  

Knowing the market and what a home is worth is the key. If a purchaser misvalues the home and overpays for the property, it will be very difficult to recoup the investment and make a profit. For example, if you purchase an over-valued home at $100,000, estimating that with repairs and renovations of $40,000, you will be able to sell the home for $160,000 and net a $20,000 profit, but later discover that the homes in that area are only worth $130,000, you will be out $10,000 in repairs and $20,000 in projected profit—not to mention the time involved. A realtor can help you to avoid costly mistakes like that. 

I have taught numerous people over the past ten years how to flip homes in Pennsylvania and Ohio, and I tell my clients that you make your profit when you buy the property. I can advise a client as to whether a property is a bargain or a bust. Fortunately, the Pittsburgh area has been a stable market with properties appreciating 2-3 percent per year, making it a desirable place to flip homes. However, there are still some other things to keep in mind. It is much easier to flip a home in a desirable neighborhood than in one that is blighted. Also, it is wise to upgrade the home to make it comparable to the others in the neighborhood. Your aim is to make it the nicest home in the neighborhood but only slightly nicer. A realtor has the knowledge to advise on what amenities will give an investor the most for their money. For instance, for a home worth $100,000, you don’t have to spend $10,000 on granite countertops and stainless-steel appliances when white appliances and less costly countertops are the norm for that neighborhood.  

I also recommend novice flippers to start small with more affordable properties because it limits your exposure. If you start by investing $100,000 instead of $600,000 in a home and make a mistake, you’ve got a lot less money tied up in the property. 

If you are interested in flipping homes, I can help you to locate the best properties, assist you in the buying process and advise you on how to invest your money wisely when refurbishing the home. Then I can help you to sell that home at the best prices possible so that you can flip that house without flipping out. 

 

 

 

 

 

 

 

BUYERS NEED REPRESENTATION TOO! 

Typically, real estate agents either represent a buyer or a seller. A common mistake a lot of people make is to call the listing agent whose name is on the For Sale sign in front of the house. Even though the listing agent can legally represent both the buyer and seller (dual agency) the question is: Are you getting the representation you need as a buyer? A real estate agent who is representing a buyer (as a buyer’s agent) is focused and committed to finding a house that fits your needs and is obligated to negotiate on your behalf in order to get you the house at the best possible price, terms and conditions. 

 Another mistake that buyers commonly make is that they don’t enter into a Buyer’s Agency Agreement with the real estate broker/agent. Without this agreement, by default the real estate agent who is showing your property is actually working for the seller. Having a Buyers Agency Agreement is important, and every buyer working with an agent should have a contract with the broker/agent. Typically, agents will want to set a term on the contract for 6-12 months or until you purchase a property, whichever comes first. Signing a contract with a real estate broker can sometimes scare people. These contracts don’t have to be for a long period of time or until you find a property. Set the duration of the contract for a couple of weeks or 30 days. Limit your obligation until you get a chance to know your agent. If you think about it, you just met the agent and you don’t want to lock yourself into a long-term contract. 

 IT’S FREE! 

A buyer’s agent is compensated through a commission. In this case, it is paid out of the proceeds from the sale price of the house. You’re reading that right. Since it issues from the sellers’ proceeds, you get the service for free! Of course, the size of commission the buyer’s agent receives can impact negotiations if the seller thinks the rate is unreasonable. There may also be a small administrative fee that your agent’s broker may charge. This fee is paid at the closing and should range anywhere from $300-$600. Any amount over this is unreasonable and should be negotiated with your agent.  

 ADVICE 

If you rely on the listing agent, he or she can only answer certain questions that don’t transgress their duty to the seller. Issues like price, tactic, and timing can be crucial in striking a good deal—but it is precisely on those kinds of issues that a listing agent is likely to be unable to advise you. Especially if you like the agent, you might be tempted to assume silence on a point means endorsement; and that could be a costly misunderstanding. Again, a buyer’s agent in your area knows the market from the buyer’s perspective, and can provide a wealth of information that point you in the right direction. 

 Considering a move? Whether it is buying or selling, have an expert work for you. Contact Vince Parrucci, Licensed Real Estate Agent, Realtor and Professional Real Estate Consultant, at Vincent.parrucci@pittsburghmoves.com, call (724) 612-3770 or visit: www.smartbuystrongsale.com. 

In addition to being a Licensed Real Estate Agent/Realtor and Professional Real Estate Consultant, Vice Parrucci is author of Smart Buy, Strong Sale: The Consumer’s Guide to Buying and Selling Your Next Home is available through Amazon.com. His extensive experience includes VP of Mellon Bank, VP of Allegheny Financial Group, Real Estate investor, mentor and coach to thousands on investment real estate and flipping of houses and property. 

  


FSBO means For Sale by Owner

FSBO means For Sale by Owner, and it’s the “road less traveled” by homeowners bent on selling a home as economically as possible. It does seem to make common sense. It’s the homeowner who knows their own home best. Why lose any part of the sale proceeds to some real estate agent?  

 The latest sampling from the NAR (National Association of Realtors) shows that the majority (88 percent) of today’s successful sellers are assisted by a real estate agent. That proportion has been growing, It’s up 19 percentage points since 2001. If it’s common sense, why does the majority eventually wind up going with a real estate agent? 

 

Most homeowners don’t even realize that the reality of trying to sell your home on your own has far too many disadvantages than benefits to the seller that can dramatically delay or even prevent the seller from selling his/her home. Most buyers work with agents because it costs them very little and gives them the assurance that a professional is representing them. 

Professional Real Estate Agents have the expertise and know and understand the real estate market better.  They also have tools available to them that are not available to the public that are used to accurately determine the market value of your home. Real Estate Brokerages/Professionals have agreements with multiple internet websites to maximize exposure on the internet.  Homes listed by Real Estate Professionals will typically have 3-4 times more internet exposure than homes marketed by home owners. 

There are several other disadvantages when trying to sell your own home.  Homeowners are left to prequalify and interview prospective buyers on their own before letting them into their house.  They will be forced to handle the difficult items to be discussed throughout the selling process. Plus, any advertising costs will be paid for out of the owner’s own pocket—an expensive strategy. 

One final note, buyers expect these FSBO homes to have a built-in savings to the buyer since the homeowner is NOT working with a Real Estate Agent.  The buyers are expecting a discount!  

Considering a move? Whether it is buying or selling, have an expert work for you. Contact Vince Parrucci, Licensed Real Estate Agent, Realtor and Professional Real Estate Consultant, at Vincent.parrucci@pittsburghmoves.com, call (724) 612-3770 or visit: www.smartbuystrongsale.com. 

In addition to being a Licensed Real Estate Agent/Realtor and Professional Real Estate Consultant, Vice Parrucci is author of Smart Buy, Strong Sale: The Consumer’s Guide to Buying and Selling Your Next Home is available through Amazon.com. His extensive experience includes VP of Mellon Bank, VP of Allegheny Financial Group, Real Estate investor, mentor and coach to thousands on investment real estate and flipping of houses and property.

 


 

When It Come to Selling a Home, the Name of the Game is “The Price Is Right” 

By Vince Parrucci,
Licensed Real Estate Agent/Realtor & Professional Real Estate Consultant 

 Your home-it’s where you raised your children, shared holidays and made memories. While all of that is important, it should not figure in when it comes to selling that home. Many people have emotional ties or pride in their homes. That is understandable, but it doesn’t equate to hard value.  

In order to sell your home quickly—and who doesn’t want a quick sale?—it is essential to price a home according to its real market value not its emotional value. What happens when a home is overpriced, is that it gets no showings, and it sits on the market. There is a lot of psychology involved with buying and selling a home. If a home is listed for $300,000 in a neighborhood where the homes are selling for $260,000, potential buyers won’t even look at it because they don’t want to insult the seller, or they fear the seller won’t accept their offer. 

If the home sits on the market month after month, the listing becomes stale, and the home can become stigmatized. When potential buyers see that a home has been languishing on the market, they often conclude, whether fairly or not, that there is something “wrong” with the house. Conversely, a well-maintained, appropriately-priced home will appear desirable and will generally sell quickly.  

So how do you price your home appropriately?  

An experienced real estate agent will know the market. When arriving at a list price, agents look at the condition of the home, its amenities, how well it has been maintained or how extensively it has been updated. Agents should pull comparables much like a real estate appraiser does and try to compare apples to apples. If the home has three bedrooms, then the agent should look at other homes in the area that have sold that have three bedrooms. But not all three-bedroom homes are alike. A three-bedroom, two-story home will most likely sell for more than a three-bedroom split entry. 

Sometimes buyers and sellers will consult real estate websites like Zillow or Realtor.com to get an idea of a home’s worth, but those don’t have access to the specific, detailed information that the Multi-List does. The sites don’t give enough information to make adequate comparables. The Multi-List is a much better resource as it has more information, and most, if not all real estate agents should have access to the Multi-List.  

Also, these sites pull comparables from a set parameter, but that range can cross over into another neighborhood and may give you a false value. For example, if you have a home in the Friendship Park neighborhood of the city, the site may compare it to a home in Shadyside, which is within their parameter, but the homes there sell for much higher prices. 

If possible, agents want sales that have occurred within the last three months and within a half-mile radius and within the same school district. School district can have an impact on a list price.  

Considering a move? Whether it is buying or selling, have an expert work for you. Contact Vince Parrucci, Licensed Real Estate Agent, Realtor and Professional Real Estate Consultant, at Vincent.parrucci@pittsburghmoves.com, call (724) 612-3770 or visit: www.smartbuystrongsale.com. 

In addition to being a Licensed Real Estate Agent/Realtor and Professional Real Estate Consultant, Vice Parrucci is author of Smart Buy, Strong Sale: The Consumer’s Guide to Buying and Selling Your Next Home is available through Amazon.com. His extensive experience includes VP of Mellon Bank, VP of Allegheny Financial Group, Real Estate investor, mentor and coach to thousands on investment real estate and flipping of houses and property. 

 
 
 
 
 
 

 By: Vincent Parrucci
Licensed Real Estate Agent/Realtor and Professional Real Estate Consultant

Finding and keeping good contractors for home improvements is always a challenge.  They are critical to the success of any project, small or large. 

So, how do you find a good contractor?  

Referrals are Key – Referrals are the best means of finding a reliable contractor. In your network of contacts (business associates, family members, neighbors, friends and even local businesses) you probably know someone who has had similar project done on their house. 

Avoid looking through the phone book or the internet.  Contractors with big ads don’t necessarily mean they are any good.  A truly good contractor will NEVER have to place an ad.  They will get more business then they can handle simply through referrals. 

However, every contractor still needs to be checked out. You need to conduct your own research on them prior to you allowing them to do any work for you. 

Specifically:

  • Get references from clients of theirs and actually call them.
  • Make sure references are from recent clients opposed to clients from a couple of years ago.
  • Ask to drive by and check out current projects that the contractor is or has completed.
  • Check with organizations such as the Better Business Bureau and various contractor referral sites and verify with the state that the contractor has an active license and is in good standing (http://hicsearch.attorneygeneral.gov or 1-888-520-6680).
  • Verify that the contractor has all of the necessary insurance, such as workmen’s comp., as well as, liability insurance. You can obtain this information directly from the contractor’s insurance company. 
  • Get multiple bids from different contractors.

Also, The Home Improvement Consumer Protection Act of 2009 requires that all Home Improvement Contractors that have conducted more the $5,000 in business (previous year) be required to register with the State every 2 years.  The PA registration number must be visible and displayed on all advertising materials.  The state also requires that a contract MUST be in writing to be valid otherwise its not enforceable.

To learn more about what sells and what doesn’t in the housing market, call Vincent Parrucci,

Licensed Real Estate Agent, Realtor and Professional Real Estate Consultant, at

(724) 612-3700, email at vincent.parrucci@pittsburghmoves.com

or visit www.smartbuysstrongsale.com.

 In addition to being a Licensed Real Estate Agent/Realtor and Professional Real Estate Consultant, Vincent H. Parrucci is author of “Smart Buy, Strong Sale: The Consumer’s Guide to Buying and Selling Your Next Home” available through Amazon.com. His extensive experience includes VP of Mellon Bank, VP of Allegheny Financial Group, Real Estate investor, mentor and coach to thousands on investment real estate and flipping of houses and property.

 

 

 


By Vincent Parrucci

Licensed Real Estate Agent/Realtor and Professional Real Estate Consultant

“You never get a second chance to make a first impression.” This saying is true for so many aspects of life, including the selling of a house. If you’re going to have a house for sale, it’s worth it to take pains to make its first impression as strong as possible.

Fortunately, making a house look ready-to-buy, doesn’t mean you must break your back or your bank account. Here are some simple, affordable projects that can be done in a single weekend:

Warm Up the Front Porch

There’s an emotional component that goes into preparing a house for sale—one that’s truly “inviting.” Often, the key factor is whether prospective buyers can easily picture themselves and their family enjoying an afternoon or evening in the place. Think about whether investing in a few pieces of attractive, comfortable-looking outdoor furniture that you could place on your front porch (or other outdoor space) could help buyers picture themselves enjoying a leisurely after-dinner conversation…and whether a comfy indoor/outdoor rug and some outdoor decorative pillows might complete the picture.  During the holiday season, some simple but tasteful holiday decorations will do just fine.

Invest in Simple Landscaping

Even just a few flower pots or window planters will invariably work to cheer up an otherwise ‘just okay’ exterior. When a prospective buyer drives up to a house for sale, a few large pots along the driveway and/or porch—sometimes with the addition of a couple of inexpensive window boxes—can make a real difference. Fill them with easy-to-care-for flowers in the spring and summer time or mums in the fall.

Trim Up and Clean Up!

You don’t necessarily have to paint the whole exterior before you list your house for sale, but it is a good idea to spruce it up by painting (or replacing) the front door, shutters, and trim. It’s a quick, affordable way to give the entire house a facelift without spending a ton of money on painters and paint!

 Update Exterior Lighting

For prospective buyers whose first look at your house takes place in an evening drive-by, exterior lighting plays a leading role. If your lighting setup is more than ten years old, you may be able to do a quick transformation by replacing outdated fixtures with stylish new ones. If twilight showings are likely, consider adding a lighted path from driveway to door.

Pay Attention to the Details

Potential buyers may be searching for the address, so a mailbox with old, missing house numbers can sabotage an entire showing. A new mailbox with bright, shiny numbers or fresh coat of paint will waylay that possibility. During the winter season keep your sidewalk and driveway clear of snow and ice.

Once those drive-by’s start wanting to come inside, be sure to pick up your stuff and clear out the clutter.  If you house looks disorganized and your yard has toys and tools scattered throughout then your prospective buyers are probably going to get sense that the house is too small for you and may have the perception that your house will be too small for them.

To learn more about what sells and what doesn’t in the housing market, contact Vincent Parrucci,

Licensed Real Estate Agent and Professional Real Estate Consultant, at parrucci@zoominternet.net, call (724) 612-3770 or visit www.vinceparrucci.com.

 In addition to being a Licensed Real Estate Agent/Realtor and Professional Real Estate Consultant, Vincent H. Parrucci is author of “Smart Buy, Strong Sale: The Consumer’s Guide to Buying and Selling Your Next Home” available through Amazon.com. His extensive experience includes VP of Mellon Bank, VP of Allegheny Financial Group, Real Estate investor, mentor and coach to thousands on investment real estate and flipping of houses and property.

cccs_1200x300_banner1-e1410447148907

cccs_1200x300_banner1-e1410447148907