Property flip - first time

Hi,
I’m a long time reader and first time poster on propertychat. I have 2 IP’s (Geelong & Torquay) and one of them which I will be moving into myself shorty (not my dream home). I’ve had the idea for a while of buying a property to flip to make a profit with the idea of buying my PPOR (dream home) in a couple of years. I would like to keep the 2 IP’s I have.
I’m chasing some help with tips of how and where to locate a suitable property, amount (%) to spend on the renovation. Basically any help would be a great help.

Thanks

 

I think it's too hard to make money this way and risky as well. The costs of purchasing and selling real estate in Australia is very expensive and will eat away your profits. My advice would be to find some potential properties and crunch the numbers to see for yourself. You are far better purchasing a good property, renovating to add value and increase the rent and then hold on for continued capital growth.

 

Hi Lawrence,
Thank for for the quality advice. That’s the exact reason why I haven’t acted on these ideas, but I always hear the stories of people doing this and being successful. I agree with you taking the lower risk approach.
I think you have confirmed my thoughts of letting go of this idea. Now to find a quality area to buy in!! Thanks again for your thoughts.

Cheers

 

Or combine the strategy outlined by @Lawrence Barnes with a development and you could be even further in front.

You would need to find a market that is rising or you think could rise in the next couple of years (Hobart, Adelaide, Brisbane, Perth). Find a splitter block with a house at the front that can be retained but needs to be renovated. Then renovate the front, rent out, hold. Build an additional dwelling in the back yard.

Of course you would need to run the numbers to make sure the deal stacks up.

I have 2 projects like this on the go.

1) renovations on the retained dwelling complete and tenant in place. The build of the additional dwelling is nearing completion.

2) renovations on the retained dwelling complete and tenant in place. No plans to build the additional dwelling at this stage.

 

Thanks Perthguy, great advice and another option. I guess you’re right about best of both worlds. Are there many of these particular blocks still available on quality and growth areas of perth? Being a Victorian, I’m not too familiar with the Perth market.
Thanks

 

There are plenty in Perth. Your issue will be finding one at a price point that works for you. Retain and build blocks tend to have some of the profit priced in. I don't mean that it can't be done, just that it takes some patience.

 

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If I use his services can I get a can of spam included

 

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