How to flip a property

Purchasing a home, only for the purpose of renovating it and then selling it for a greater price is a popular kind of property investment that, while not new, has grown more popular in recent years thanks to a number of global reality shows.

South Africans are also getting in on the action, with YouTuber Stephen Baron making a profit of about R1 million after flipping a house in Johannesburg.

The concept of flipping a house sounds straightforward, but you do need to know what you are doing. Arming yourself with as much information as possible is the first step to a successfully flip.

Bellow are three things to consider before starting.

1. Set your budget

Find out how much you can afford to invest, you can do this by speaking to your bank or a bond originator to get an idea of the home loan amount you can qualify for.

When you do find a property you are interested in, determine what the After Repair Value (ARV) will be. This is the estimated value of the property after renovations have been done.