If you're a fan of home renovation TV shows, you've probably thought about giving it a go yourself. But before you do, let's discuss some of the key pros and cons to help you make an informed decision.

Let's talk about the upsides of the Flipping Houses:

1. Potential for Gains: The most attractive benefit of house flipping is the possibility of making a significant profit in a relatively short duration. If you buy a property at a well negotiated cost, renovate it with the best of materials and workmanship, and sell it in an ascending market, you could enjoy a substantial return on investment. The only condition is that the work you put into the o the property needs to be of the highest order, which would allow you to command the best price in the open market. 

2. Creative at the Core: Flipping houses allows you to express your creativity. You can transform a rundown property into appealing and a functional space, along the way making decisions about design, layout, and aesthetics. If you have an incilnation for interior design and a vision for potential, this could be an exciting venture. The thumb rule is if you can imagine an empty room without any furniture and can visualize how it will look an behave with furniture and artifacts, that foresight and creativity is needed in this domain. Or how a kitchen design can be altered to make better utilization of the floor plan.

3. Learning Experience: Flipping a house can be an incredible learning experience. You'll get hands-on knowledge about real estate, construction, negotiation tactics, and the local housing market. You would be able to foster and create lasting partnerships with the various trades people - contractors, plumbers, electrician, professional painters, flooring contractors, quartz and kitchen design personnel, landscapers, HVAC technicians etc.


But it's not all smooth sailing, house flipping comes with its own share of risks and challenges. Let's talk about the downsides:

1. Financial Side: House flipping is a significant financial risk. Unanticipated costs can add up quickly, from structural issues discovered during renovations to higher than expected contractor fees, or a sudden drop in the housing market. Specially in the Greater Toronto Area market in the last 2 years there has been a lot of churn and movement in the prices. In a volatile market situation like the current one, the timing and price for the property purchased would majorly determine the success or failure of the project. 

2. Time Intensive Process: Contrary to what TV shows might suggest, flipping houses is time-consuming. Searching for the right property, dealing with contractors, obtaining necessary permits to start the work, and the renovation process itself can take longer than anticipated. It would need a good patience level in you to deal with all moving parts and variables in the project duration. 

3. Pressure Sensitive: House flipping can be stressful. Managing budgets, dealing with unexpected issues, and meeting timelines can be a high-stress endeavor. Plus, until the property sells, all the pressure is on you to carry it for the entire development and selling process. 

4. Needs Knowledge: Successful house flipping requires a deep understanding of many areas - real estate market trends, renovation costs, what home buyers are looking for, and much more. Mistakes or misjudgments in any of these areas can turn a potential profit into a financial loss. It also requires a steady inventory of industry people from different trades in order to do a quality job in the upgrades. 

We covered a fair bit of detail on both sides of spectrum for property flipping. It can be both rewarding and risky. It can be very beneficial provided you work on a budget, follow a timeline and most importantly but a good asset with potential and have a vision to make it great, and then executing the vision.  

Flipping projects also requires careful planning, a substantial time commitment, and an understanding of the real estate market. But with the right property and the right strategy, it can offer a significant payoff. Remember, if you're considering diving into the world of house flipping, it's important to do your homework and possibly consult with a real estate professional.?

Wish you all the very best! Reach out to our dedicated team at Elixir for any queries you have in Real Estate and we will do our best to help.

Mudit Mehta 
Broker of Record
ELIXIR REAL ESTATE INC.
Off: 416-816-6001 | [email protected]