If you are looking for a comprehensive guide to start flipping houses in the state of Kansas, you’ve come to the right place.
One of the easiest ways to begin investing in real estate is to flip houses. It might be a profitable business venture. However, because it is a high-risk investment, you need to consider a lot of variables.
But don’t worry, I’m here to assist you with your research and decisions. The market research, appraisal, and procedure for flipping houses in Kansas are all broken down in this comprehensive book.
Flipping Houses in Kansas
The housing market in Kansas is one of the hottest in the country. It’s a once-in-a-lifetime income opportunity for house flippers. Despite the low housing market valuation, investors who pick the right properties and flip houses in Kansas earn a substantial profit.
Every investment, including real estate, is highly specific to its location, and Kansas is no exception. Paying attention to current market happenings and knowing how to respond quickly will assist you in determining whether you have made a profit or loss. You should always work with a local specialist real estate agent to understand the trends in these local markets and find investment possibilities. Their comprehensive understanding of the ins and outs of these particular property markets can assist you at every turn.
Analyzing the Kansas Housing Market in 2022
Kansas is the 10th most affordable housing market in the US. Kansas’s average house value is $202,102 as of April 2022, which is much less than the national average home value of $344,000 Furthermore, house values in Kansas climbed by a little more than 8.86 percent in 2021, and are expected to rise by a stunning 13% in 2022. These prices, on the other hand, vary even within the state, indicating how regional and localized property markets are.
This property market trend in Kansas has drawn real estate investors from all around the country. Kansas’ residences are in more demand than they are available. This has resulted in a strong seller’s market in Kansas’ housing market. It’s easy to understand why investors are flocking to Kansas’ real estate market. Two of the key reasons for development are the expanding population and the better employment and education sectors. Kansas has a high school graduation rate of 90.7 percent and a median household income of $58,000.
Kansas job market is also moving in the right direction. Employment growth is expected to continue in 2022, with an increase of 1% and the addition of 13,401 new positions. The first quarter of the year is predicted to be the most productive, before slowing in the second half.
In addition, Kansas’s extremely low housing costs make the market more accessible to first-time real estate investors. You’ll need less money to get started, which implies there will be more newbies in the future and therefore greater competition.
How to know if the house in Kansas is a good investment?
After learning about Kansas’s broad housing market and economy, you’ll probably want to check into a more specific location and community to identify potential houses. Keep in mind that not every local home market offers the same kind of investing options.
In general, determining whether or not a property is a suitable investment is based on a number of variables. As a general guideline, avoid local marketplaces with a lot of inventory and listings that have been active for a long time while you’re just getting started. Houses in Topeka, KS, on average, sell after 37 days on the market. This signifies that it is a no-go if the property in the region is still operating after 37-50 days.
Another indicator that a home in Kansas is a smart investment is if the price is lower than the local market average. One of the easiest methods to spot possible value is to look for properties that are much less expensive than previous sales in the area. Keep in mind that the less costly residences will require far more modifications than the more expensive ones.
How much should I pay for a house in Kansas?
It’s usually a good idea to keep to the 70% rule when deciding how much to spend on a home in Kansas. According to this rule, you should never spend more than 70% of the house’s after-repair worth, less repair and renovation expenses. Let’s say you buy a house in Kansas and want to spend $20,000 on repairs and remodeling. Keep in mind that upgrades raise the property’s market value. Let’s say your house is worth $250,000 after repairs.
According to the 70 percent rule, you shouldn’t have spent more than 70% of the after-repair value minus repair expenditures on this property. When you add up the numbers, it only amounts to $155,000.
It’s critical to keep in mind that the 70% rule is discretionary. It’s only an estimate of the house’s genuine worth. This rule aims to create a profit margin that is substantial enough to pay all other costs while flipping houses in Kansas while still leaving you with a good profit margin.
Do you need a real estate license to flip houses in Kansas?
You don’t need a real estate license to flip houses in Kansas. However, if you want to start flipping properties in Kansas full-time, getting both a realtor and a contractor’s license is usually a good idea.
If you don’t want to deal with the challenges of getting a realtor or contractor’s license in Kansas, that’s OK. In this instance, I strongly advise you to use a seasoned realtor and contractor with whom you can establish a positive working relationship.
Finally, if you are new to Kansas, finding a trustworthy contractor or repairman may be challenging. Furthermore, zoning restrictions and standards vary by city, and market trends shift often. Working with a trustworthy agent or contractor might help you foresee problems.
How to start flipping houses in Kansas and make a profit?
You’re ready to begin your home flipping journey in Kansas once you’ve done comprehensive research on the Kansas property market and are confident that the house is a solid investment. Follow these six steps to begin flipping houses in Kansas and benefit handsomely from this type of real estate investing.
1. Create a Budget and Secure Financing
When flipping houses in Kansas, the first thing to consider is your financial status. It’s usually a good idea to do the math before looking at prospective attributes.
If you have cash on hand, you should already know how much money you have. By paying cash for your Kansas house flips, you may avoid financing charges, mortgage payments, and any other closing costs or fees. As a result, if you have cash while flipping houses in Kansas, you should always use it.
Using a loan or other types of financing to purchase and renovate a home might drastically reduce your potential profits. If you took out a $200,000 loan to buy a property in Kansas, you’ll keep making mortgage payments until the house is sold. Even a 5% down payment on a property might cost upwards of $10,000 to buy. In addition to the $20,000 for repairs and enhancements, you’ll need to invest an additional $10,000.
Repairs and enhancements, unfortunately, take time. As a result, you may wind up paying your mortgage for a longer period of time, perhaps losing a large profit margin. Furthermore, after accounting for property taxes, building permits, utilities, marketing costs, closing fees, home insurance, realtor commissions, and other costs connected with flipping houses in Kansas, you may not be able to make any money at all.
As a consequence, having cash may help you save money on all of these things while also allowing you to keep as much of your earnings as possible.
But don’t be concerned if you don’t have any cash. There are still a few alternative ways to support your house-flipping business on a shoestring budget.
2. Research the Cities and Neighborhoods
After you’ve found the homes that are listed below market value and taken into consideration other factors such as active days on the market, you can assess the neighborhood’s attractiveness. When it comes to flipping houses in Kansas, the quality of the neighborhood is crucial. Other quantitative variables, such as the quality of education, entertainment, parks and recreation, and the neighborhood’s shopping experience, should be examined in addition to the listing and sales price.
Existing housing stock in Kansas’ older villages, as well as a rapidly growing urban region, might benefit from rehabilitation and repair. In Kansas, you may make a nice living by flipping properties. You must, however, learn to recognize the appropriate options.
Here is a list of the 4 best cities to flip houses in Kansas for 2022.
Flipping Houses in Wichita, KS
Wichita is the biggest city in the state of Kansas. This city is composed of 100 neighborhoods and offers multiple affordable duplexes, townhouses, and affordable multi-family homes. As of April 2022, the median listing home price in Wichita is just $195,000, trending up 8.9% year-over-year. The median listing home price per square foot is $107. Furthermore, on average, houses in Wichita sell after 43 days in the market.
The city offers 131 public schools rated good and higher by GreatSchools and 37 private and charter schools. Wichita also offers hundreds of grocery stores, restaurants, and cafes. There are also a plethora of beautiful parks and gyms for a healthier lifestyle.
Out of the 100 neighborhoods in Wichita, Auburn Hills is the most expensive one with a median home price of $400,000. On the other hand, North Central is the most affordable neighborhood, with a median listing home price of just around $70,000. There are also some other great neighborhoods like College Hill, South Central, and Riverside.
Flipping Houses in Topeka, KS
Topeka is the capital city of Kansas. It is composed of 28 neighborhoods and offers multiple affordable duplexes, townhouses, and affordable multi-family homes. As of April 2022, the median listing home price in Topeka is $160,000, trending up 9.1% year-over-year. The median listing home price per square foot is $98.
The city offers 48 public schools rated good and higher by GreatSchools and 16 private and charter schools. Topeka also offers hundreds of grocery stores, restaurants, and cafes. There are also a plethora of beautiful parks and gyms for a healthier lifestyle.
On Average, houses in Topeka sell after 37 days in the market. Out of the 28 neighborhoods in Topeka, Westboro is the most expensive one with a median home price of $270,000. Conversely, West Meade is the most affordable neighborhood, with a median listing home price of just around $55,000. There are also some other great neighborhoods like Central Topeka, Oakland, and Randolph.
Flipping Houses in Lawrence, KS
Lawrence is a city in Kansas that consists of 26 neighborhoods and offers multiple affordable duplexes, triplexes, and affordable multi-family homes. As of April 2022, the median listing home price in Lawrence is $325,000, trending up 30.1% year-over-year. The median listing home price per square foot is $164.
On Average, houses in Lawrence sell after 59 days in the market. The city offers 23 public schools rated good and higher by GreatSchools and 5 private and charter schools. Lawrence also offers hundreds of grocery stores, restaurants, and cafes. There are also a plethora of beautiful parks and gyms for a healthier lifestyle.
Of the 26 neighborhoods in Lawrence, Gateway is the most expensive with a median home price of $525,000. On the other hand, Pinckney is the most affordable neighborhood, with a median listing home price of just around $172,500. There are also some other great neighborhoods like Deerfield, Prairie Park, and West Lawrence.
Flipping Houses in Overland Park, KS
Overland Park is a city in Kansas and is composed of 65 neighborhoods and offers multiple affordable duplexes, triplexes, and affordable multi-family homes. As of April 2022, the median listing home price in Overland Park is $400,000, trending up 14.3% year-over-year. The median listing home price per square foot is $165.
The city offers 73 public schools rated good and higher by GreatSchools and 17 private and charter schools. Overland Park also offers hundreds of grocery stores, restaurants, and cafes. There are also a plethora of beautiful parks and gyms for a healthier lifestyle.
Out of the 65 neighborhoods in Overland Park, Mills Farm is the most expensive one with a median home price of $1,000,000. On the other hand, Historic Overland Park is the most affordable neighborhood, with a median listing home price of just around $225,000. There are also some other great neighborhoods like Oak Park, Nall Hills, and Arrowhead Trails.
3. Assemble your team
You’ll need a team of individuals to make each flip a success, whether you’re flipping houses full-time or part-time in Kansas. A real estate lawyer, a lender, a real estate agent, a general contractor, a few laborers, and an accountant will almost certainly be required.
Working with a trusted team rather than a new specialist for each task is also great if you want to make house flipping a regular element of your investing plan.
4. Select and Purchase your Kansas House
It’s finally time to buy your Kansas house after you’ve sorted out your finances and determined whether or not it’s a suitable investment. Another thing to bear in mind when buying a property is that properties that require more maintenance and upkeep are frequently less expensive to acquire. As a result, reselling them will take longer.
On the other hand, houses in good shape that do not require considerable repairs and renovations are much more expensive. You will save a lot of money in the long run and will not have to worry about house improvements if you spend more money upfront.
As a consequence, when looking for a property in Kansas, try to find a middle ground between these issues. Choose a home that is appropriate for your abilities, budget, and time frame.
5. Repair and Renovate the House
Consider how much money will be required for repairs and upgrades, as well as how long they will take. Determine which upgrades will add the most value and whether or not they will appeal to potential buyers. Adding air conditioning and energy-efficient modifications to a home may quickly increase its value for homeowners who want to escape the hot and humid Kansas summers and harsh Kansas winters.
Furthermore, power washing the outside of the house, painting the inside, fixing a leaking faucet, reglazing and caulking bathtubs, and cleaning the floors are all small but vital jobs that will help your property sell faster.
6. Resell the Renovated Kansas House for a Profit
It’s time to re-list the property after you’ve finished fixing and restoring it. You have two options for reselling your home in Kansas. The first choice is to sell as a for-sale-by-owner (FSBO), while the second is to sell through a real estate agency.
Saving money on commissions is one of the numerous advantages of selling your home without the help of a real estate agent. Even if you sell your Kansas property on your own, you must pay the buyer’s agent a commission (3 percent ). You’ll need to be ready to bargain like a pro and fill out all of the paperwork correctly if you want to sell your property swiftly.
If you don’t want to deal with the hassle of selling the home yourself, you may always hire a professional real estate agent. The process of preparing contracts, discussing them, signing them, and closing them will all be expedited. However, you will be required to pay them a 3% fee for their services.
How much money do house flippers make in Kansas?
In the United States, the average revenue per flip is $60,000, whereas, in Kansas, it’s just approximately $52,000. As a result, Kansas’ average revenue per flip is $8,000 lower than the national average. That is to say, it makes sense. In this state, affordable housing and rising quality of life attract a large number of real estate investors, resulting in increased competition and, as a result, lower revenue per flip.
It’s also vital to note that the revenue per flip is not the same as the net profit. You’ll also need money set aside for repairs and restorations. Depending on the present status of the property, a broad variety of repairs may be required, but if you invest $20,000 in repairs, the home will be worth it. After deducting all additional fees and levies, you’ll have a net profit of $10,000 to $15,000 to work with.
As a result, it’s reasonable to anticipate that flipping a single property in Kansas will net you at least $10,000. In addition, the average real estate investor flips 4-5 residences each year. That implies if you flip properties full-time in Kansas, you can expect to make roughly $50,000 per year.
Overall, flipping houses in Kansas is an excellent way to begin investing in real estate. Kansas is fast expanding and has a lot to offer its residents since it is one of the most profitable states for real estate flipping. Furthermore, discovering lucrative flips in the Sunflower State necessitates a blend of your skills, expertise, and chance. Once you’ve found a fantastic deal on a house in Kansas, be sure to follow a well-planned strategy, renovate the property if needed, and sell it to a high-end buyer.