Probably the biggest mistake rookie flippers make when deciding to remodel a home for profit is lack of planning. Research is vital to a successful remodeling flip. Not anticipating unseen costs can turn a profitable flip into a bottomless money pit in a hurry. The following are some mistakes to avoid when considering a house flip.

1. Do not give yourself too little time to properly complete the job. Unseen problems can put a project over schedule which can seriously affect budget. Ensure you can afford to carry the costs of the remodel as well as the cost of mortgage payments in the event the house does not sell as quickly as anticipated.
2. Do not, on the other hand, procrastinate project completion unnecessarily. Time really is money in this case. The longer the project is drawn out, the more your carrying costs will eat into your profits. Carrying costs include mortgage, insurance, and utilities payments required by the homeowner while the home is being remodeled and on the real estate market.
3. Do not cut corners by failure to get the home inspected prior to closing on the initial deal. Unseen, hidden damages can blow your budget. In some cases, such as asbestos in older homes and damaged foundations, these unseen problems could make the project not worth the time, money and effort required to restore the home for resale. A thorough home inspection will help you make a wiser, more informed choice when selecting a project house.
4. When locating financing for your flip project, ensure that you are able to cover the entire project from purchase to resale. It is extremely important to be able to make draws on funds when the need arises instead of delaying the work while you seek further funding.
5. Before you purchase a home, ensure that you do your homework on the area in which your project home is located. Ask yourself some important questions: Will the average person feel comfortable and safe in this neighborhood? Are you “over fixing” the home compared to other properties in the area? You wouldn't want to buy a house in a lower priced neighborhood, remodel it to a high priced home, and then not be able to resell because the price is not competitive to comparables in the area. If the home is in an historical area, what are the restrictions pertaining to remodeling? Must the paint colors or improvements be approved by a historical committee prior to commencing the work? Does the house meet code standards? Some homes may be allowed to not meet code…Until you make improvements or excavate for new plumbing or wiring. Bringing a home up to code may be prohibitively expensive. Are there major drawbacks beyond your control to a potential buyer's desire to buy your home? For instance, is the home located too closely to main interstate where access to the home would be inconvenient? Is the home located close to a school or business that would increase the noise level? Is the home in a flood plane, requiring the homeowner to carry more expensive insurance?
6. Make sure you obtain necessary permits to complete work prior to beginning the work. Obtaining permits after the fact can cost valuable time in an already limited schedule. Money may be wasted due to scheduling conflicts with contractors who had expected to be working on your project, but were unable to do so due to lack of a required permit.
7. Another mistake flippers often make is trying to design a project home as if they were going to remain there. Warm paint and wood colors help create an inviting atmosphere, but colors that are not easily complimented tend to put off buyers. Exotic wall treatments, fixtures, and paint should be avoided in favor of tasteful and more neutral styles. In the same vein, quality should not be sacrificed for speed of installation and resale profits. The old adage “You get what you pay for” definitely holds merit here.
8. Many flippers believe that the job can get done without supervision. If you want to make your flip successful and profitable, you must supervise every stage of the work. Not only will this help you stay on schedule but it will allow you to know the quality of work being accomplished with your hard-earned money. Although home remodeling can be very stressful and make one desperately in need of a vacation, renovation time is definitely not the time to leave the project unsupervised. There will be plenty of time to enjoy relaxation after you have completed the work.
9. Staging the project home is a step often overlooked by sellers. Staging is the careful and planned placement of furnishings and accessories to complete the overall look of the home. Furnishings need not be expensive or fancy. Rental furniture may even be a wise idea to plan into your budget. Proper staging provides the potential buyer with an immediate idea of purpose and size of rooms in the home. Staging can also help diminish small imperfections in floors and walls. Staging can be the one point which showcases your home best.

With proper planning and diligent budgeting, remodeling homes for profit can be fun and extremely lucrative. Arm yourself with knowledge before any major remodel project. This will not only make the job proceed more smoothly, but will most likely increase your profits in the long run. Happy flipping!