By Jeanette Joy Fisher

Flipping Houses

Many real estate investors make $5,000 to $10,000 or more by flipping houses. These investors secure a contact of sale from a distressed seller and resell it quickly for a profit.

Just because a seller has serious problems like a pending foreclosure or divorce doesn't mean the house is a fixer. Many distressed sellers offer prime houses in perfect condition discounted for a quick sale.

Fixers

Other real estate investors prefer to buy fixers from distressed sellers. Distressed fixers tender the best bargains to make the highest return on your money. For instance, if you put 5% down on a $200,000 home, spend $5,000 fixing the house up, and another $3,000 in payments, your cash investment totals $18,000. If you sell the home for a $70,000 profit like many rehabbers, you can see that your return on your investment of $18,000 for two months exceeds most other types of investments.

This investment plan assumes that you have the knowledge and skills, time to work on your fixer, and that you sell the house as soon as its finished to a qualified buyer.

Home improvement centers help you with how-to classes, brochures, and advice. You need to give up your free time--TV, parties, leisure activities and work on your fixer. You could hire workers, but contractors and laborers work slowly and eat up your profits.

The last part of the equation, selling your house quickly to a qualified buyer means you need to do your homework. Many investors seek free help from a loan officer to price the house right and to qualify their buyers. These investors earn the sales commission by selling their houses by owner.

The most important issue, how you fix up your house, ensures that you quickly attract a buyer willing to pay top dollar for your transformed property. Investors using Design Psychology strategies for fixing houses sell their homes, for more than the asking price, three hours after putting the yard sign out.

Whether you want to make money investing in real estate by flipping or fixing houses, you need to understand your market. To get started in your real estate business, go house shopping. You'll soon learn how to pick up a flip or a fixer and be on your way to making a high return on your money.