Unlike flippers, real estate traders do something a little different; instead of buying a home, making renovations, and reselling for profit, they buy a property at a low cost, hold it for a short period, and resale for profit. The primary difference between a flipper and a trader is a flipper often goes after a property that needs work, but a trader is merely investing in a piece of complete property that will fetch a higher sale price later on. The key to doing this kind of real estate investing is knowing what to look for in the properties that will tell you they could be more valuable a little later.
Find real estate properties that have an up-and-coming setting.
Perhaps there is a new theme park being built in a specific location, a new group of luxury homes just around the corner, or even a new business coming to town that will attract a host of newcomers as employers. The setting of the home's location is something that has to be heavily considered with trading. If you time your investment properly, you can pick up homes at a low price and later liquidate them for a healthy profit because more people are looking to move to the designated area.
Find real estate properties that are desirable as they are.
Because you are not flipping a property, you will not be putting work into the place before it sells. Flipping ties up a lot of time and money when your end goal is to turn an easy profit. Therefore, you do not want to go searching for houses that have a load of flaws that will have to be fixed. It's fine if you have to do a little sprucing up for curb appeal with the landscape or perhaps lay on a fresh coat of paint, but in general, the property should be desirable just as it is.
Find real estate properties with a low enough price tag to leave room for profit.
This is where the bottom line of real estate trading lies. The lower the price tag, the more money there is to be made. If you find a property that you are fairly certain you can sell later on for a profit, don't make the mistake of assuming a slim line of profit will suffice. Remember, just having the property can cost you money because it is not being used, so a slim profit margin will not give you much wiggle room if the house does not sell right away, and you could end up taking a loss.
For more information on how to purchase real estate, contact a local real estate agent.