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The shows on TV make flipping houses look so easy. Buy the house, paint the house, sell the house. Lately, though, there are updates at the end of the show: "The house has been on the market for three months. The owner has received no offers." Not exactly what you want to hear, right?

If you want the best shot at earning money on your flip, here are some ideas.

1. Pay cash for the house. Yes, it will be a large outlay right at first, but you'll
get it back when the house sells. And by paying cash you won't have to make those
monthly payments while you wait for it to sell.

2. Do the work yourself. Labor is the largest expense you are likely to encounter.
The more of it you do yourself the more you'll save, and the more you'll earn when
it sells.

3. If you do need to hire subcontractors, check around and ask for written bids from
at least three different contractors before you decide. Not everyone charges the
same amount. You can also check with the local trade schools to see if they are
looking for projects in order to train the students in construction. The students
do the work but they are supervised by professionals to ensure that the job is done
right.

4. Shop around for materials. There are many outlet stores that sell building supplies,
and some that sell used but still serviceable materials that have been removed
from remodeling projects and were too good to just throw away. This could save you
a lot.

5. If it ain't broke, don't fix it. Some investors go in with a sledge hammer and start
tearing out everything with a grand plan to make it all new. If the cabinets are
in good shape, painting or refinishing is cheaper than new cabinets. If there is
hardwood flooring that can be refinished it is a lot cheaper than replacing it.

6. Don't over-improve. The end value of the home will be the market value as compared
to others that have sold in the neighborhood. You can do a good job and improve
the house. Just don't add solid gold faucets in a tract house and hope to get your
money back.

Flipping houses can be fun and profitable, but you have to be aware of the limitations of your cash flow and your expenses at all times or you can go over budget with one bad decision or purchase. Good luck, and happy flipping.

Learn more about this author, JoAnn Powell.
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