Is flipping expensive for cash home buyers?

Flipping is risky and tougher than it seems on TV, especially in Pittsburgh! More often than not, it usually ends up taking a bit longer and costing more than anticipated from entry to exit. Many home sellers we speak with consider flipping their own house as a possible option for selling.

Let’s break down what all goes into a fix and flip! (We’ll show you a detailed example with realistic figures at the end.)

Pittsburgh cash buyers typically see a return of 20-30% net profit, and a flip takes an average of 4-6 months from entry to exit. The less construction a property needs, the quicker you can sell it. This will shorten your timeline to minimize expenses and maximize profit! A home buyer in search of a flip won’t typically find the risk, time, capital, and effort worth it for anything less than a forecasted 20% net return.

There are 4 main components: Buying costs, holding costs, selling costs, and income tax

Buying costs:

  • Purchase Price
  • Closing costs (usually 3% if paying only the buyer customary costs)
  • Inspections: home, camera sewer, radon, pest, mold (if applicable)
  • appraisal (if applicable)
  • loan origination fees (if applicable)
  • Finders fee (if applicable)

Holding costs:

  • Insurance
  • Utilities (water, electric, gas, sewer, trash)
  • Landscaping/lawn upkeep
  • Taxes
  • Construction (labor and materials)
  • Interest payments (if applicable)

Closing Costs:

  • Realtor fees (if applicable)
  • Closing costs (usually 3%)
  • Seller concessions/seller assist (if applicable)

Income Tax:

  • 25-35% of your net profit based on your ownership structure and tax strategy

Example:

Why Should a Seller Choose Cash Home Buyer Pros?

When working with our team at Cash Home Buyer Pros, we strive to offer unbeatable value, convenience, and benefits.

Here are a few reasons for what makes us different from the rest, and how you benefit:

  • We pay cash and buy as-is
  • We offer a generous purchase price that our competitors won’t
  • We pay all closing costs
  • Seller pays zero Realtor fees
  • We don’t order home inspections or appraisals
  • We don’t ask the seller to make repairs
  • We let you (the seller) choose the closing date; we won’t ask you to leave in a rush
  • Seller may leave any items in the property we buy; don’t worry about spending time or money to clear out or clean the property
  • We can help you find a rental or help you buy a new home if moving out of the home you sell us
  • Decades of experience in brokerage, investment, and construction
  • Guaranteed professionalism
  • Fair, honest, and transparent
  • We only conduct business at the highest standard of ethics and values
  • Even if we do not end up doing business with you, we are happy to connect you with resources and help you create your desired outcome

Our Feature on WQED’s “The Pittsburgh Flip” Documentary

In October 2019, our company and its founder Liz Kazeva were featured in WQED’s documentary on Pittsburgh’s housing market and its notable local real estate investor players.

Liz gave WQED a tour of her 6 unit multifamily intensive renovation project located in Mount Washington.

Check out the video below to watch our segment:

Quarantine Approved: Safely Sell Your Home or Property

Complete our contact form by CLICKING HERE or call 412-772-4200 to get started. Know your options! Cash Home Buyer Pros has solutions for when you need them the most. We have a very effective way to help sellers who strongly want or need to sell during quarantine. It is COVID-19 safe, contact-less, and virtual! Our team remains fully staffed and available to help you in times of uncertainty. We will make you an offer by phone on the spot.