House flipping know how

Adelaide-based Charyn Youngson has successfully bought, renovated and sold more than 15 properties (for herself and, more recently, for clients) in the past nine years. She says despite the costs involved in buying and selling property, by sticking to a few simple rules you can make a fast profit every time.

Buy below market value

Youngson aims to purchase properties for about 20 per cent below market value. While that may sound ambitious, she says some vendors are prepared to take less in order to achieve a fast, fuss-free sale.

“It’s true that most properties are not sold at such a discount, but I seek out those homes where the vendor is motivated to sell quickly.”

Cosmetically renovate – and fast!

Youngson says the three hot spots in any home are its street appeal, kitchen and bathroom. “If you can easily upgrade or improve those, you’re on to a winner.

“Time is money so I only ever purchase properties that can be simply improved in around three to five weeks. I never do anything structural and I stick to existing layouts in kitchens and bathrooms to keep the costs down.

“New paint, new blinds, new lights, new flooring, new shower screen and vanity … you can give a home an enormous facelift with a well-planned cosmetic renovation. Being quick about it means you minimise hold costs and you’re not exposed to unforeseen market downturns that can dampen your profits.”

DIY and upstyle

Youngson aims to DIY as much as possible. “The first property I renovated, I did almost everything myself (with some help from a friend) and made $30,000 clear profit in just five weeks.

“I also style every home I renovate with furniture, artwork and accessories so that it looks as fabulous as possible. Styling is the secret ingredient to achieving both a fast sale and a premium price.”

Buy at the lower end of the market

Working at the low end of the market is less risky. “You’ve got more buyers who can afford the property if you’re operating in the less expensive suburbs,” says Youngson.

“You’re also appealing to buyers who don’t expect granite bench tops and other high-end fixtures and fittings, which means you can upgrade the property more cheaply.”

A recent case in point is a property in Adelaide’s Klemzig that Youngson recently renovated for a client. “He’d had it appraised at $380,000. I spent $15,000 on painting, new flooring, window treatments and a garden tidy-up over three weeks, styled it up with furniture, and it sold at auction for $488,000. He was thrilled!”

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Build a good team around you

Youngson has built up a reliable team of tradespeople she calls upon as soon as she’s exchanged contracts. “I try to negotiate access to the property with my carpenter before settlement, so he’s ready to start the day settlement takes place. I also maintain good relationships with real estate agents – they know what I look for and they call me if they list the right sort of renovator’s delight for sale.”

Think positive

Attending a wealth-creation course inspired Youngson to kickstart her house-flipping journey. “I learnt about a lot of different ways of generating wealth through property, but more importantly, I developed a positive mindset and the self-motivation I needed to get started.”

Fake it before you make it

Youngson says its no good acting green around real estate agents, because they’ll eat you alive. “Before I even attended my first open-for-inspection, I had business cards made up that said ‘Charyn Youngson, Property Investor’. I handed them to every agent I met and let them know I was serious.”

Be realistic and do your research

“Be conservative with your numbers,” advises Youngson. “Never inflate what you think you’re going to make. Make sure you’ve done your research and know what properties in the areas you’re targetting are really worth.”

Although house flipping requires a can-do attitude plus diligence and careful planning, those who’ve done it say success is more than possible.