In the real estate world, investors make money from properties in many different ways. Two common methods for making money are reselling and flipping. At first glance, both terms seem alike but they are quite different. House flipping and reselling are two different approaches and they are not the same thing. Let’s find out how flipping and reselling differ from each other.
Flipping: The Art of the Quick Turnaround
It is a practice where you buy a property at a low price. Usually, investors buy property with poor conditions and renovation requirements. Flippers are often on the hunt for items that they can buy, fix, and sell quickly. The speed of transactions is the key to making huge profits here.
For example, a flipper buys a property that needs room renovation. He buys it at a low price and renovates it by following the latest interior design trends. Now property looks amazing, and he is able to sell the property at a high price.
The difference between the buying and selling price is his profit from the transaction. The ultimate goal of flipping is to make a profit by swiftly turning around the item or property.
Reselling: A Broader Approach
On the other hand, reselling is a broader concept. In this case, an investor buys multiple properties and then waits till the time price hike. Once the price increases, he sells them and makes a profit. He doesn’t make a quick profit but only when the price of a property or item goes high.
For example, an investor buys a bulk supply of sneakers at a discounted price. Now during seasons of sneakers, he starts selling them at a high price and makes a profit. He has to wait till the time is right.
The concept of Reselling is quite broad and isn’t limited to physical goods either. It can extend to services, such as reselling web hosting or software licenses or even selling digital products like ebooks.
The Key Differences
Here are some main differences between flipping and reselling:
Speed
Flippers like to close the transaction as fast as possible to make a profit while reseller wants to wait till the time price increases. So, flipping is a quick turnaround practice while reselling can be a longer-term endeavor.
Profit Approach
Fippers make money from individual items while resellers make profits from the sale of multiple items or services.
Scope
Flipping has a limited scope. Usually, real estate investors use a flipping approach to make a profit from properties. However, reselling has a broad scope. Reselling involves a wide range of products or services, bought in bulk or from wholesalers, and sold over time.
Which One Is Right for You?
Now you might be wondering whether you should opt for reselling or flipping. The choice of practice totally depends on your financial goals, personal preferences, experience, and resources. However, here are some factors to take into account:
Flipping might be right for you if:
- You’re looking for quick profits.
- You enjoy finding undervalued items and improving them.
- You have a knack for identifying market trends and opportunities.
- You prefer a hands-on, active approach to buying and selling.
Reselling might be right for you if:
- You’re comfortable with a slower, long-term approach to making money.
- You have the resources to buy items in bulk or from wholesalers.
- You prefer managing an inventory of items over time.
- You want to establish a sustainable and ongoing source of income.
Conclusion
Flipping and reselling are two different practices and they are not the same thing. If you don’t mind committing to an investment for the long term, reselling might seem like a great idea. However, when you want to make quick profits, flipping is a great practice. Keep in mind that you can make a steady income stream from reselling as you can buy multiple items and keep making profits from them while waiting for the right price.
