Nearly everyone has heard the term "fixer-upper" used to refer to a house that needs significant repair and renovation before it can be a family home or before it can be resold. For many, this process is called flipping a house, especially if the repair/remodelling work is not extensive. In the last few years, a number of TV shows, books and audio packages have focused on teaching the layman how to flipping a house can be exciting and profitable.

Perhaps the best place to start is with a local house that is not too expensive but also does not require a lot of remodelling work. Finding the right combination of purchase price and house condition is the key to successful flipping, because the object is to do a limited amount of repair and renovation then sell the home quickly, at a profit. Tip: Be sure to understand thoroughly why a house is on the real estate market. The details of roof, plumbing, floors etc. will determine if the house is a likely flipping project.

Remember that a home in perfect condition is not a great candidate for this process, because the purchase price will probably be too high to add a few thousand dollars of profit. Most of those who have made flipping houses a profession look for a structure that needs a medium amount of work before it can be resold. Homes that require a complete "rebuild" are often poor flipping projects as well.

Of course, the basic idea is to purchase a house at a price well below market price for the square footage, number of rooms, location etc. With minor repair, like new and careful attention to remodelling detail, the home can then be resold, with the sale price covering remodelling costs and providing a tidy profit. It is easier to enjoy the remodelling and reselling processes if a profit results. One key factor is to get the home back on the market and sold before more than one or two payments are made on a mortgage. House payments and interest can eat into house flipping profit quickly.

Remember that a successful project will probably involve more than surface fixes and a new coat of paint. A good inspection by a professional home inspector can uncover most, if not all, of the necessary repairs and remodelling tasks. Keep in mind that almost every remodelling project and house flipping will involve some unforeseen repairs and expense. The idea is to keep these to a minimum.

Some who are in the business of buying and selling homes focus on foreclosures, a situation in which the buyer is under pressure because he or she can't make payments. Often these homes are on the market for a fraction of their actual value, because the owner simply needs to get away from the mortgage payments and expense they can't afford. Because these homes often have a 20, 30 or 40 percent discount from the actual value, they can be excellent choices for flipping.

The ultimate goal is to purchase houses, repair and remodel them, then sell them for enough to provide funds for buying another home. It's nice if a few dollars of profit go into the bank account as well, while building a house flipping business.