Property flippers in Florida understand that the real estate market in the state goes through cycles. A seller’s market today may not attract buyers tomorrow. Inflation, personal mortgage interest rates, upcoming construction, and even seasonal weather can create peaks and valleys in Florida’s real estate market. Flippers in Florida need to be able to adjust quickly to market cycles so they can generate revenue. However, property flippers can still come out on top in both upswings and inactive periods.
Flipping Properties in Florida During a Market Boom
Property flippers love upticks in Florida’s real estate market because they can increase their profit margins. Yet even when real estate in Florida is experiencing upward pressures, property flippers still face two large challenges: funding and time. Funding is always an obstacle for property flippers in Florida. In a seller’s market where properties are being purchased left and right, traditional lenders still believe that there is too much risk involved in fix and flip projects. Property flippers in Florida face high turndown rates and increasingly prohibitive requirements to get the financing they need. In those rare cases when property flippers are approved for traditional loans, the processing time takes too long, causing opportunities to be missed, and some funds are not disbursed until after the upswing has passed, forcing property flippers to miss out on revenue.
The funding challenges facing property flippers in Florida brings us to the second obstacle: time. During a market boom, property flippers in Florida try to purchase and renovate as many properties as possible before sales start to slow. As noted above, finding fast and efficient funding is crucial, but so is being able to get everything in order for fix and flip projects. This means getting the correct permits, materials, skilled contractors, and more. With the right financing and ambition, property flippers can purchase and renovate multiple properties in just a little over a month.
When property flippers need fast, flexible, and affordable financing to keep projects on track, they partner with The Commercial Funding Store. Our fix and flip financing is designed specifically for real estate markets in Florida. Fix and flip loans, as well as fix and flip lines of credit from The Commercial Funding Store feature fast closings, generous terms, and can be used for individual and multiple properties throughout Florida. Our team offers customized solutions to keep fix and flip projects on track, regardless of size or scope.
Strategies for Property Flippers in Florida When the Market is Down
There are times when the real estate market in Florida is experiencing downward pressure. Flippers may find properties sitting on the market for longer than expected. Instead of continuously lowering the prices on these properties, property flippers can use what is called a “fix and hold” or “fix and rent” strategy. Newly renovated properties can be taken off the market, and the equity value can be used to finance further improvements or other real estate ventures. Alternatively, if property flippers want to generate revenue until the market improves, they can position their properties are short or long-term rentals. This way, fix and flip projects can pay for themselves by covering expenses and giving flippers extra money to put in the bank. When the market inevitably improves, the properties can be listed again to make a quick sale.
While property flippers may not feel time constraints as much as during a market upswing, getting properties renovated to rent out to tenants still needs to be done quickly and efficiently. The faster properties can be rehabbed, the faster they can be filled with tenants. Much like regular fix and flip projects, that means finding fast, flexible, and affordable financing. Traditional lenders, such as banks and credit unions, are more likely to turn down loan applications from property flippers during a lull in the real estate market because they do not want to bear most of the risk. However, property flippers have better financing options available to them. Fix and rent strategies required tailored financing that can be scaled to the properties they are turning into rentals.
A successful fix and hold/rent strategy requires funding from a source that understands Florida’s real estate cycles and the benefits of repositioning properties as rentals. Traditional lending channels focus on bottom line numbers and if borrowers are drawing a regular salary, so applying for a bank loan is nearly impossible when property flippers are generating revenue from sales and uneven monthly rent payments. However, a financial firm that is familiar with the cycles of the fix and flip market in Florida can arrange and process funding quickly. At The Commercial Funding Store, we work directly with property flippers throughout Florida to successfully finance their projects, from individual properties to multiple units, and even entire portfolios. We provide financing to cover the needs of flippers when they want to use fix and rent strategies to generate revenue. Our financing is fast and accessible. Because we specialize in real estate financing in Florida, we do not have the high bar of entry or other requirements used by banks to keep property flippers from getting the funds they need. Best of all, we understand the fix and flip market and can lend our expertise to help property flippers at all levels to navigate challenges and overcome obstacles.
Ensuring Success in Any Real Estate Market
Fix and flip, as well as fix and rent strategies, give property investors in Florida a way to generate revenue in any economic climate. The Commercial Funding Store is a Florida-based financial firm that has provided funding to property flippers working on single projects on up to seasoned pros managing dozens or even hundreds of units at once. Whether you are taking advantage of a market upswing by renovating properties to sell, or you want to position your portfolio to employ a fix and rent strategy, the experts at The Commercial Funding Store can help. Contact our offices to get the financing your need.