What is a deal?


How do you know if it's a deal? You must know the value of properties in that neighborhood. Use only recent comps (comparable – other homes that have recently sold in the area) from properties located within a mile. Even then, be aware that a different zip code, street name or school district can dramatically change the value of a home. Location is the name of the game in any real estate deal. Be wary of busy streets, electrical wires, noisy schools, sewage treatment or landfills in the area.


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However, if you get a really low price, you still may be able to make money in these areas. A common mistake newbies make is thinking that just because something is in foreclosure or is bank-owned property, it's a deal. This is not true and can often be the opposite. To be able to make a profit, you don’t want to buy just any run-down home. Try to find a property that’s not in an area where all the homes seem like fixer uppers. Look for an area where house values are already rising or where other homes in the area are worth substantially more than the home that needs fixing. This will give you the most profit from your investment. You’ll find the best bargains from homes that have been left vacant by their previous owners.


You also want to determine if the damage can be fixed reasonably. The best houses to flip easily are those that require mostly cosmetic fixes, like new paint, countertops and carpeting, as opposed to damaged pipes, roofs, or foundations. Once you’ve found a home you think has potential, find out if it will be worth your time and money.


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