Here is an example of “flipping” a house in Hilo, Hawaii.
This house was listed as a short sale on 6/12/2015 at $225,000. An offer was accepted on the same day. But it took about 11 months to close because of the short sale process. It was sold at $195,000 on 5/18/2016.
Then, the buyer renovated the house, and put it on the market for sale at $320,000 on 12/7/2016. Within a week, an offer was accepted. It’s still in escrow. I’ll report how much it’s actually sold when the sold price becomes public.
In Hilo, whenever a house in good condition and released on the market for sale at less than $350,000, buyers who’ve been waiting for such an opportunity rush to see the property.
The house was refurbished with new hardwood bamboo floors throughout the home, new granite countertops, and all new stainless steel refrigerator, range, range hood, dishwasher, microwave and kitdchen sink. All the walls in and out were freshly painted, kitchen cabinets and doors were refinished. The roof was cleaned and painted, and the yard was nicely landscaped.
Please be aware that a higher capital gain tax will be applied for transactions owned for less than a year, and usually you can’t use the 1031 exchange program to defer the capital gain tax for flipped properties.