5 Common House Flipping Problems to Watch For

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House flipping problems are common and can result in wasted time and lost money. Fortunately, they are easier to avoid when you know what they are. From electricals and plumbing to funding your projects, here are some of the most common issues that you must keenly watch out for.

Underestimating the Cost

Aside from buying a property, the renovation costs are the highest you will probably face. Homes for flipping can sometimes be in a relatively favorable condition, but most of the time, there will be a lot of work to do. Renovation costs a lot of cash.

Hopefully you’ll just need to work on cosmetic details, like flooring and paint. But some projects have more complicated and expensive needs. Major plumbing issues, polybutylene pipes, dangerous or old and uninsurable electrical panels, fire damage. In one home, we had a major settlement issue, and you may see something like this too, and need to contact a specialist. For instance, specialist services like foundation repair by companies like http://rsfoundations.com/ are required for that type of job.

Contractors don’t work for free, and often, they only give estimates, so ensure you have the funds available. And budget a bit extra just in case.

If you are embarking on a new project and want a guide to help you with your budgeting and planning, you can use the Project Renovation Organizer which I have as a downloadable product that you can re-print for every project.

Electrical and Plumbing Works

Two of the most critical jobs when flipping a house are the electricals and plumbing. Older homes especially have many issues with these, and a new buyer needs these to be perfect. A lot of times, if the electrical is too old or the plumbing is polybutylene, a new buyer won’t be able to insure the home without upgrades.

As a seller, you also have a responsibility to ensure the home is safe. As a flipper, you want to be sure you can sell it. An inspection is always needed to assess the home and find the problems. Loose wiring, split connections, and old junction boxes are dangerous. And it isn’t even worth thinking about the hazards of waste pipes.

More Money More Problems?

Any house you flip is subject to taxes. But some people are shocked when they have to pay large taxes on a real estate investment and successful flip. After all, the more money you make, the higher your tax bill will be.

In 2022, over $120 million was owed in back taxes, and you don’t want to end up in this situation. However, taxes can be challenging to understand, so enlist the help of an accountant if you aren’t sure. Keeping track of your income and expenses, maintaining separate accounts, and knowing what you can write off on taxes is essential and helps in maximizing your profit on a project.

Funding and Payments

You need enough money for the entire project, whether you plan on paying for the investment from personal funds or an alternative. Contractors need to be paid and supplies need to be purchased.

While most contract labor will work first and require payment later on, it’s a slippery slope to disaster if you don’t already have the money available or if they change pricing as the job goes on. Anyone working on the project will have the legal right to take you to court for non-payment of services if they don’t get what they are owed.

So, make sure finances are always clear. Get estimates and pricing agreements in writing and pay your workers promptly and keep your payment receipts.

The Location, Of Course

A property can often feel like a bargain. But there are usually reasons why a specific home is so cheap. There are many reasons, and one of the biggest is often the location. Perhaps the house is in a bad neighborhood with crime issues. Or maybe it is too far from convenient services, schools or workplaces. Any of these will prevent the chances of flipping a house as they tend to get in the way of tenants having a comfortable life. Which is what we all really want, is it not?

Know the area where you’re purchasing, and be aware of any changes coming to the area, whether they be zoning changes, new medical and shopping facilities, or new schools. These could all be potential selling points for your project.


Underestimating the cost of a project is just one of the major house-flipping problems to watch out for. It also helps to learn how to handle taxes and always consider the location as well. Planning is key to a successful project.

Good luck with your project and if you’d like to look through some of my projects and the profit earned, just head to the “flipping” tab above, hover over it, and you’ll find several projects there from start to finish!

Eric’s First Condo Flip–Start to Finish

Southpointe Condo Flip

30 day Condo Flipping Project [with profit report]

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