7 Things Not to Do When Flipping Houses (ABC News)

1. Don't Overestimate Your Skills

Flipping houses may seem relatively simple compared to other business ventures, but it still requires extensive knowledge and skills. Without considerable experience in construction, real estate, and finance, you could easily lose money.

2. Don't Underestimate the Costs

The cost of flipping a house often exceeds the initial budget. Unexpected expenses can arise during renovations, such as structural issues or hidden damage. Factor in all potential costs before starting the project.

3. Don't Neglect Market Research

Determine the target market for the flipped house before investing. Research comparable properties in the area to estimate the potential resale value and ensure there is demand for the renovations you plan to make.

4. Don't Overextend Yourself

Taking on too many properties simultaneously can spread your resources thin. Focus on completing one project at a time to maintain quality and avoid financial strain.

5. Don't Cut Corners

Using cheap materials or hiring inexperienced contractors may save money upfront, but it could harm the home's value and result in costly repairs down the road. Prioritize quality materials and workmanship to protect your investment.

6. Don't Ignore Legal Requirements

Obtain necessary permits and comply with building codes before starting any renovations. Ignoring these requirements could lead to legal issues, fines, or even the property being condemned.

7. Don't Overprice the House

Pricing the flipped house too high can make it difficult to sell and lead to a loss. Research comparable properties and consult with a real estate agent to determine a competitive price that will attract buyers.