Introduction to House Flipping

How can I avoid paying taxes on a flip?
What taxes do you pay when flipping a house in the UK?
Where is the best place to flip houses in 2021?

• IRS Section 1031 allows taxpayers to do a "like-kind exchange" to defer paying taxes.
• You don’t pay capital gains tax, as HMRC doesn’t see property flipping as an investment.
• The average flip netted the seller a gross profit of $67,902 in 2020, a return of 41.3 percent.

Starting a House Flipping Business

• The first step in starting a house flipping business is to research the local market.
• Find startup costs ranging from $30,000 to $60,000.
• Get licensed as a real estate agent to save on commissions.
• Create a business plan outlining your strategy.
• Secure financing from private lenders or hard money loans.
• Insure your business properly.

Steps for Flipping a House

• Renovate properties before selling them for a profit.
• Decide whether to sell renovated homes or rent them out.
• Create an end goal for properties you acquire.

Executing a House Flip

• Stay on budget to reach ROI.
• The 70 percent rule says to pay no more than 70 percent of after-repair value minus renovation costs.
• Flipping takes 4 to 6 months.

Execution Steps for Flipping a House

• Start by researching neighborhoods and choose a location.
• Purchasing includes finding, evaluating, and closing on a property.
• Marketing includes listing the home.
• Sale completes when escrow closes and funds are dispersed.

Skills and Recommendations for House Flipping

• Flipping requires knowledge of construction, finance, and remodeling.
• Have plans for unexpected work.
• Network to build your house flipping team.