by: Jeanette Joy Fisher

Many real estate investors enjoy "flipping houses," or buying and
selling houses quickly for profit. Not all flips are fixers.
However, rehabbers make millions turning ugly houses into
dollhouses. On the other hand, some inexperienced investors lose
money buying houses that just don't turn a profit.

If you're looking to get started investing in real estate by fixing
and flipping houses, you'll want to know what type of property to
buy.

HOW TO FIND THE PERFECT FIXER

1. Know Your Market

Your first task, exploring your market, helps you know a bargain
house when you spot one. Look at many houses for sale in your area.
Keep track of sales and how long the houses take to sell. Ask
selling real estate agents about the terms of these sales because
this helps you understand how sellers market their property (some of
this information is public record). For instance, if a seller paid
closing costs for the buyer, did the price rise from the listed
price accordingly? Or, did the seller come down on the price and
also pay the buyer's costs?

Examine the sales that sell quickly. What home features and
financing options prompted the fast sale?

Also, look at model homes. Buyers often buy resale homes because
they can't wait for a new home to be finished. However, these buyers
like the distinctive features new homes offer. Visit model homes and
take notes on how details like a water fountain or a new
state-of-the-art appliance makes a house sell itself. When you
remodel your fixer, you'll know what attracts buyers and you'll make
smart redesign choices.

2. Know When "Ugly" Means "Gold"

When you first start out in your real estate "flipping fixers"
business, you'll want to look for houses needing only cosmetic work.
Look for houses that just need cleaning up, painting, and new
flooring. Use your imagination when viewing these homes. Try to
visualize the finished dollhouse as you look at structural features
and the surrounding homes. Make offers on the ugliest houses in
decent neighborhoods.

Don't be afraid of stinky houses that show horribly. Search for
fixers with peeling paint, holes in the wall, stained carpeting, and
trash in the yard. Remember, these houses won't look good to most
buyers, but other real estate investors see them as gold mines.

3. Know When "Ugly" Means "No Thanks"

When you're new to real estate investing, always remember your
limitations. Use caution when considering houses that need
structural repairs. Some rehabbers replace walls, plumbing,
structural beams, sub-flooring, and electrical systems. These
experienced real estate investors acquired those skills after years
of experience or they have the money to pay for professional help.

If you find a house with structural problems, get estimates from
reliable contractors to do the work. If the walls have too many
cracks and bumps, you may need to hang new sheet rock or hire a
professional plaster refinisher. Check for signs of plumbing
problems such as water stains under sinks and loose flooring, and
get estimates for professional repair. Take professional estimates
into account before deciding whether or not to purchase an
investment property. Any big expense decreases your eventual profit.


Turn Yucks into Bucks

Why would anyone want to do this hard work? How much does the
average rehabber make? In Ohio, real estate investors buy houses
expecting a profit of about $30,000. In Southern California, many
investors make $50,000 to $100,000 on each house.

When you find a garbage-filled, flea-infested house in a family
neighborhood, take your bug spray, hold your nose, and get ready to
make a difference, in the neighborhood and in your bank account.

You can make a fortune fixing nasty houses. Know your market. Know
when "ugly" means profit in your pocket, and when to keep looking
for the house with the hidden gold mine.

Copyright © 2005 Jeanette J. Fisher. All rights reserved.

About the author:
Jeanette Fisher teaches beginning real estate investors five easy
steps to find, finance, and fix houses for profits. Free ebook on
fixing houses using interior design strategies for top-dollar sales,
http://www.doghousetodollhousefordollars.com/