PHOENIX, AZ / ACCESSWIRE / May 21, 2021 / 2021 is one of the best years to consider purchasing and flipping a house. Michael Alexander Candelario, Arizona resident has helped investors understand the real estate market before, but this is the first time he has seen a period look so promising for investors who plan on flipping residential properties.
Flipping a house typically means finding the right property in a growing area, buying it at an affordable price, and making specific renovations that will increase home value so that the house can be flipped or resold at a sizable profit. Timing is crucial when flipping a house, and market research is vital — but those willing to invest are looking at good odds. Here’s why Michael Candelario believes 2021 is the year to make a move.
Inventory is Opening Back Up, and Buyers Are Ready
2020 saw record-low inventory across many real estate markets. The combination of COVID-19 restrictions and general economic uncertainty led to many people putting their plans on hold. That included those who were thinking about selling their properties as owners hunkered down and waited for more suitable conditions.
In 2021, we’ve already seen things beginning to change. Inventory is slowly opening back up, and people are renewing their plans to move, invest in property, or find a new home. That’s a lot of pent-up demand, which makes it easier for house flippers to find buyers — and the opening market means that it’s also much easier to find potential investment properties than it was last year.
Many Regions Continue to See Rising Home Prices
Michael Candelario also points out that the limited inventory and demand in 2020 led to quickly-rising home prices, which means the ROI of house flipping looks especially good. High demand for newly renovated homes has led to some of the best returns for house flipping that have been seen recently — currently around $66,000 on average. If you are looking to make a good return or have been holding onto the property until the right time to buy, 2021 is your year to take action. This has favored specific types of markets, like smaller growing cities with less traffic and more room, “Zoom cities” that became especially popular in 2020 as remote work grew more accessible and people looked to move out of more crowded areas.
Specific Properties Have Become Highly Affordable Investments
Rising home prices aren’t always a good sign for flippers, who generally look for underpriced properties and are wary of markets with too much price inflation. The good news is that several options are available for affordable purchases that Michael Alexander Candelario recommends for those who want to keep initial investment costs low or put most of their funding into renovation rather than purchasing. Particularly, small homes, rentals recently appearing on the market, and Airbnb properties that owners would rather sell are all options worth considering.
Financing Options are Trending Aggressively Toward House Flippers
2021 is also shaping up to be an excellent year for financing, specifically for these types of investments. In recent months, the number of banks and other institutions that offer loans for flipping houses has grown by 50%. If finding the right loan package for a flipping-related investment has been what’s holding you back, the market has never been more favorable. Look for flipping loans that have excellent short-term numbers if you would like to sell in 2021 as well.
Realtors Have Adapted Well to the Times
Another primary aspect is an investor’s relationship with real estate agents. Michael Candelario suggests that any investor interested in flipping with an experienced, fast-moving realtor who is active in the region where they have purchased a property. The good news is that competent real estate agents were quick to adapt to the times in 2020 and have a number of options for interested buyers, including virtual reality tours and remote online tours for those who are living far away or those who are not comfortable showing up in person yet as the vaccine rollout continues. Look for realtors that offer these options to expand your field of buyers as much as possible.
Renting is Always an Alternative If Things Don’t Pan Out
Homes on the market aren’t the only properties seeing low inventory. The rental market is also in a very interesting position in 2021. Many buyers are willing to consider rentals as an alternative. Still, rental freezes across the country are also creating many closed markets and pushing up rental prices even higher. The end result is that an investment property purchased for flipping should also be a very viable rental property if plans change.
Finally, Michael Candelario Suggests Scheduling Contractors ASAP.
For those looking to flip in 2021 and 2022, it’s important to act now. Another side effect of 2020’s pent-up demand is that contractors are very busy scheduling out months ahead of time, if not longer. It’s crucial to get on their schedule quickly to avoid delays.
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SOURCE: Michael Candelario