Less competition also lends itself to the next reason why taking on these fix and flip projects during winter months is smart for investors. With these projects getting started in between November-February, investors can have them ready to sell or rent during the peak season. This dichotomy of buying a property when there is less competition and prices drop as a result, mixed with having a rehabbed property ready to hit the market when buyers are most interested is a recipe for success. That interest will obviously drive the prices up and investors can cash in on the hard work they put in during the winter months. Finding renters or buyers becomes much easier during the spring and summer months as people stop looking and moving becomes much more inconvenient.
An excerpt from an article on fitsmallbusiness.com perfectly illustrates this point, “Similarly, prices jumped from $376,559 in January 2022 to $424,146 in April 2022. The rise in sales prices between the winter and summer months is drastic, making the winter months a much more optimal time for investors to purchase properties.” This increase of nearly $50k is due in large part to demand in the market. Having your investment property ready for resale or tenants once April, May and June hit can lead to a big payoff. Once that bigger paycheck comes in, then investors have more money in their pocket to target their next investment. This allows for a significant step up in quality of properties that an investor can afford and help them grow faster.
If investors are worried about not getting their projects done in time to hit that peak season of interest by buyers, this next reason to do fix and flip projects in the winter should ease that worry. One of the most surefire ways to ensure these projects get done in time is to collaborate with a trusted contractor. With less competition and less investors swarming the market in what many perceive as “down time,” a lot of contractors will have more availability as a result. Having this much access to contractors is something that many investors will not be used to but something they need to take advantage of. Another factor to consider for investors is the relationships that they can build with these contractors. If an investor is providing work for a contractor on a year-round basis, the contractor will step up their quality of work and attentiveness to the investor due to the steady stream of work and as a result, money.
In addition to contractors, material costs will be an aspect that investors need to track and use to their advantage throughout the winter months when planning their fix and flip investments. During winter months, discounts on materials are more likely to occur so investors need to be vigilant when searching for materials at the right price. With less demand in the market due to less investors being active, deals will be there for investors to capitalize on. This will lead to another opportunity for an investor to improve their ROI and keeping material costs as low as possible is one of the best ways to go about that.
The last reason why investing in fix and flips during the winter months is such a good strategy has to do with the mindset of a real estate investor. Usually, the people that stick around the longest in this business are the ambitious people, always wanting to be moving forward with their business ambition and never wanting to stay in neutral. Working on projects all year round is a great way to emulate this mindset and business practice. Staying sharp with their investments and tracking the market trends and patterns will make an investor more well-rounded and more successful on a yearly basis. If investors are utilizing sensible business practices all year round, then that will only add to their longevity in the industry. Extended breaks away from real estate investing can lead to complacency or a lack of knowledge that could set investors back when they decide to start up again.