Feb 6, 2025
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While TV shows make home flipping look easy, in reality, it’s a high-risk investment. Professional flippers often put in a lot of sweat equity, or they have a network of trusted contractors who work at a fair rate. They also typically spend a lot of time analyzing real estate market trends to ensure they can make a profit.
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If you just dive into flipping without these advantages, it's entirely possible you could find yourself sitting in a house you can't sell, and writing checks for mortgage payments you can't really afford. If this happens to you, here are a few options for dealing with the situation.
Ensure the price is right
The Dallas housing market is getting more competitive, with Redfin reporting a 7.6% increase in median home prices from December 2024 over the previous year. But homes are also taking an average of 56 days to sell compared to 31 in 2023.
If your home isn't selling, it's worth checking with a real estate agent to see how you could better appeal to your target market.
Lowering the price is one option if you want to offload the property ASAP. Just remember that if you can't sell for enough to exceed your mortgage and renovations, plus closing costs and fees, you won’t be making a profit.
Consulting a professional financial advisor can help you sort out these questions and ensure you have enough funds to stay afloat — even if your property sits on the market for a while.
Through Advisor.com, you can connect with a vetted financial advisor who can guide you through this journey.
How it works
Three easy steps to get matched with a financial advisor.
- Step 1: Answer a few quick questions about yourself and what you would like help with.
- Step 2: Advisor.com will match you with a vetted advisor who can provide you with a personalized plan based on your financial situation.
- Step 3: Book a free, no-obligation consultation to confirm if your match is right for you.
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Explore other profitable options
You don’t necessarily have to buy a property and flip it in order to benefit from the booming real estate market. Instead of having to deal with downpayment and mortgages as well as the headaches of upgrading a property, passively investing in real estate may help you generate similar, if not higher, profits.
While commercial real estate has underperformed compared to residential real estate over the past few years, one avenue has secretly thrived: necessity-backed retail commercial properties.
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Retail properties had the lowest vacancy rates compared to any other commercial real estate sector as of 2024, according to the CBRE Group.
Accredited investors can invest in such real estate through First National Realty Partners (FNRP). You can own a share of institutional-grade properties leased by brands like Walmart, CVS, Kroger, and other household names.
Featured
Gadd Crossing
Hixson, TN
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Crowe's Crossing
Stone Mountain, GA
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Bishops Corner
West Hardford, CT
These are a few examples of past properties or acquisitions from FNRP. For a full list of currently available properties, visit the FNRP deal room.
The best part? FNRP distributes any positive cash flows to investors every quarter. Thus, you can potentially set up a passive income stream without having to do any heavy lifting.
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Investing in real estate can diversify your portfolio, but it comes with an inherent risk: it’s difficult to predict what’s going to happen.
But real estate investments also carry significant risks. Rather than outright committing to invest in real estate properties, you can invest in loans used to fund home renovations or other improvement projects through Arrived Private Credit Fund.
These short-term investments are significantly less risky than investing in real estate, as they are typically backed by the underlying residential properties.
Arrived Private Credit Fund has historically delivered 8.1% in annualized dividend yield, distributed monthly. You can get started with a minimum investment of just $100.
If you want to kick things up a notch, you can diversify your real estate portfolio further by investing in commercial properties.
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Consider refinancing your mortgage
Finally, if you're struggling with your mortgage, you could try to reduce the monthly payments. You can do this by refinancing — although there are upfront closing expenses, this approach makes sense if you decide you're going to keep the house for a while.
You can compare the rates offered by various lenders near you through Mortgage Research Center. All you have to do is answer some basic questions about your property and your finances (including your annual income and credit score), and Mortgage Research Center will compile a list of refinance rates offered by lenders near you.
You can also get connected with custom mortgage offers from lenders, and set up a free introductory call with no obligation to hire.
Remember: Always do the math to see how many months it will take for lower payments to cover closing expenses so you break even.
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Aditi is an experienced content developer and financial writer who is passionate about helping investors understand the do's and don'ts of investing.
