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Among the top businesses to start these days, taking on fixer-uppers to resell would definitely rank way up there. So if you find yourself constantly daydreaming about renovating a property from top to bottom, then going all in for a fixer-upper could be an excellent fit for you.

 

Find the Right Property to Flip

 

One of the most challenging things when starting the flipping business is finding the right property to flip. Of course, this will come down to a whole host of factors, including finding the right location. Moreover, the location you end up choosing has the potential to significantly impact your asking price at the end of the day. Therefore, it really has to do with finding the right property in a location that is a popular choice for those looking to settle down. 

 

Furthermore, the more affluent the area, the more of a chance you have to push the ceiling up regarding the selling price you can negotiate with a prospective buyer. It’s best to see what the average selling price is in the area first. Then, calculate the cost of expected renovations and see if that home is worth the effort. If the renovation costs plus the lowered price of the home will still give you a profit selling around this price, then it may be worth purchasing.

 

Make Your Business Official

 

If you have chosen a home to remodel and flip, then you should protect your investment by making your passion into a legitimate business. Filing for an employee identification number offers several benefits: 

 

1. Legal Requirement: If your business is a corporation, partnership, LLC, or has employees, you are generally required by law to obtain an EIN. Compliance with this requirement is essential to avoid legal issues and penalties.
2. Separation of Business and Personal Finances: An EIN provides a distinct identification number for your business, allowing you to keep personal and business finances separate. This is crucial for asset protection and financial clarity.
3. Tax Reporting: An EIN is necessary for various tax-related purposes, including filing income taxes, employment taxes, and other business-specific taxes. It simplifies the tax reporting process and ensures you comply with tax laws.
4. Business Credit: An EIN can help establish a business credit profile, enabling your company to access credit, loans, and financial services independently of personal credit. This can be crucial for business growth and financial stability.
5. Professionalism and Credibility: Having an EIN can enhance your business’s credibility and professionalism, especially when dealing with vendors, clients, and partners. It signifies that your business is legitimate and well-established, which can improve your business relationships.

 

Overall, obtaining an EIN is a foundational step for any business, providing legal compliance, financial organization, and access to critical financial and tax services.

 

Decide How Much You Want to Renovate

 

Apart from the effort, you’ll have to put into renovating a property, you’ll also have to decide on your budget and how much money you’ll require to spend on upgrades, both minor and major. Ideally, you’ll want to keep major renovation costs to a minimum where you can, as this can end up eating into your budget and take up extra time that you probably don’t have. One attractive renovation that you should consider is adding an outdoor range hood. They’re available in a variety of styles and price ranges, and this is a great but relatively simple way to upgrade your home.

 

Things You DON’T Want to Renovate

 

Indeed, all that glitters isn’t gold, and this couldn’t be more true when it comes to fixing up that old, dilapidated fixer-upper that you see real potential in. Furthermore, some fixer-uppers are beyond repair, including those with major structural damage such as foundational issues, those significant plumbing problems, roofing issues, electrical faults, etc.

 

Projects to DIY Versus Those You Should Outsource

 

If you are particularly handy at DIY, then you could look at taking over some renovation work yourself, including painting rooms, installing floating shelves, adding a backsplash to the kitchen or bathroom, and putting up wallpaper. 

 

However, there are the more complicated tasks of upgrading a home, such as doing the plumbing to ensure that the plumbing system performs adequately and doesn’t pose health problems to its occupants; the safety reasons for hiring someone for electrical work; and the enormity of installing a heating and cooling system. These are the types of tasks that are best left to the professionals. 

 

Another thing you might want to get a professional to do is gutter cleaning by enlisting the help of a company to clear gutters of debris as well as for repairs and maintenance should any of your gutters become damaged or need replacing. It is probably better to invest in gutter guards with plastic mesh for as little as $1 per linear foot to prevent your gutters from getting damaged. Or you could go with steel gutter guards for just a dollar extra for the same amount that would probably end up lasting longer. 

 

Where to Begin Renovations

 

When thinking of redoing rooms within a property that are going to influence the selling price of the home, the bathroom and kitchen are areas that come out on top. New Silver explains that these should be your priority areas, and that they require a lot of your time, money, and focus to get it to look as ‘wow’ as possible.

 

Decide Whether to Keep, List, or Rent Your Property

 

Perhaps you’re not quite ready to let go of your property once it’s done. Then it’s okay to hold onto it until you’re ready to decide what to do with it. Moreover, it’s also fine to keep it as an investment and rent it out if you’re after long-term passive income. Alternatively, you can wait to flip it when the market’s right and earn yourself a hefty profit at the end of it!