Flipping Houses: When to Hold Out for More
As Kenny Rogers once said, “You’ve gotta know when to hold ‘em, know when to fold ‘em.” It’s especially true when flipping houses. Although your real estate agent might encourage you to take the first offer that comes along, sometimes it’s better to hold out for more. Here are a few instances when it’s better to act against your realtor’s advice and wait for a better offer:
- When you’ve been lowballed. If you’ve set a reasonable asking price for your real estate investment, don’t settle for an offer that’s thousands of dollars less than what you know your house can sell for. Many times, it’s better to eat the cost of a prolonged listing than it is to accept a basement-level offer.
- When you’ve just listed the house. When someone offers to buy your home right after you’ve placed it on the market, don’t take the plunge right away. An early offer may mean that you have an opportunity to play interested buyers against one another – and that can mean thousands of dollars more.
- When the neighborhood’s selling fast. When your house has been sitting on the market for a month, you might be tempted to consider the first offer that comes along. But if sales of similar properties in your area are picking up, you should hold out. The chances are good that as buyers see more and more properties snatched up, they’ll be willing to pay your asking price.
Successfully flipping houses requires both intuition and experience. While real estate agents are a big help when you’re selling a home, you should remember that they have their commissions in mind above all else, and they’ll sometimes encourage you to accept your first offer. Although that can certainly be tempting, if your gut says that you could make more on the house, it’s probably right.