Home Buyers home renovations

Flipping Houses For Profit [A Guide For Beginners In Canada]

If you have been watching the Canadian real estate market and seeing prices go through the roof, you have probably wondered if you are not missing a trick by not investing in a few properties yourself. Flipping houses is an especially hot trend right now. 

Before you cash out all your investments and go all-in on flipping houses for profit, know that it’s not all sunshine and rainbows. Like all other investments, you can lose money if you don’t do your homework.

We prepared this short guide to help you understand what flipping houses is and the factors you need to consider before buying that fixer-upper for flipping.

What Is House Flipping?

House flipping is where you buy an old, distressed house and repair and update it with the intention to sell it at a profit. ‘Flipping’ itself refers to the process of repairing, renovating a house to bring it up-to-date with current trends and at times to add square footage and features that make it livable and more appealing to buyers.

When the time comes to resell the house, you want the total spend from buying the property, renovation costs, and any applicable fees and taxes not to exceed the expected value after repairs. Now, in a market such as Toronto where home prices are going up all the time, your chances of selling at a profit are conceivably good.

Many beginners will take out a mortgage loan to finance a house purchase. If that’s you, you need to find a mortgage broker that understands this business and your local market as a first step.

The second and perhaps better option is to deep into your savings and pay cash for the house, the renovation/repair, and all the other costs involved. 

With so much money on the line, you have to know what you are doing for a flip to be profitable. Here’s what you need to keep in mind before you start flipping houses:

What You Need To Know Before Buying A House To Flip

There’s money to be made flipping houses. But one thing you need to know, though, is it’s not as easy as they make it look on HGTV. There is a lot of work and money involved, some of which can go down the drain if you don’t take note of the following:

1. Flip With a Target Buyer in Mind

The best way to approach flipping houses is as you would any other business. You start with a customer need in mind and then work out how to satisfy it in a way that is profitable to you. In this case, the need you are hoping to meet is that of suitable, affordable housing for a specific type of home seeker.

If you blindly buy and renovate properties without any idea who your potential buyer is, your chances of success are slim. The flip can take too long to sell, resulting in you incurring carrying costs that will eat into your profits. In the worst-case scenario, you may be stuck with an expensively renovated house that no one wants to buy.

So you need to identify a target buyer first to get an idea of the type of house you need to flip. This could be old couples downsizing to a smaller property or young professionals looking for a family-size home to plant roots. These people prioritize different features and amenities in a home. Also consider a specific location’s proximity to schools, shopping, health facilities, sports and entertainment venues, and clubs.

2. Draw a Realistic Budget

With a clear idea of the type of house and location you have to shop in, you can now draw up a realistic budget for this flip. Because you have profiled your target buyer and know which features are important to them, you can know the first time you inspect a potential flip house what renovations it will need and how much it will potentially cost.

It is quite easy to neglect some costs, which can only derail the project and cost you money later. The obvious costs will be the property’s purchase price and the renovation costs. But there are other costs involved in a house flip, like building permit fees, capital gains tax, staging and other selling costs.

Unless you already have a buyer waiting in the wings, you also have to budget for the house’s carrying costs. These are the costs that a homeowner pays, including the mortgage, utilities, property taxes, insurance, and general maintenance. You pay carrying costs as long as the house remains unsold, so you must have an allowance for them in your budget.

3. Know the True Renovation Costs Before Buying a Fixer-upper

The savviest house-flippers are those that can identify homes that only need a few repairs and cosmetic touch-ups to bring them up to date. The less you spend on repairs the better your chances of turning a profit. 

If you spend a lot on the renovation, the problem is the house will be too expensive than buyers are prepared to spend for houses in that neighbourhood. This point highlights the need to engage a knowledgeable contractor. 

An experienced contractor will know after a careful inspection how much work and investment it will take to bring a house to a livable, modern condition. A wall may need to be knocked out, windows enlarged, the roof raised, and floors replaced to improve energy efficiency and ease of maintenance. 

Just recently, Canada experienced a crippling lumber shortage that saw prices rising to record highs, so always factor in changing market conditions when going into this business.


A good local contractor will have a better understanding of the current prices of materials and the general logistics of carrying out a renovation like the one you are planning. So resist the urge to go the DIY route and hire an experienced local contractor.

4. The 70% Rule

There should be no room for sentiment when reviewing houses for flipping. No matter how good the location is and how much demand there is for that type of house, do not overpay on the purchase price.

The 70 percent rule of flipping houses is when buying a fixer-upper, you should not pay more than 70% of the after repair value (ARV – the home’s value after it’s repaired) minus the repair costs. Pay more than 70% APV and your chances of selling at a profit or recouping your investment reduce.

5. Flipping Houses Requires a Significant Time Investment

As well as capital, it takes a significant amount of your time to find a house to flip, renovate, and sell it. It could be months before you close a sale on your flip.

Even where you have hired a good contractor to do the renovation work, you will still need to manage them to ensure the work finishes on time. It’s worth sitting down and considering if you will have enough time to manage the flip, especially if you have a full-time job.

Finding the right property can also be a game of patience. You have to have the fortitude to wait as long as it takes to get the right property. With more flips, it will get easier to identify houses to flip and negotiate good purchase prices.

6. Hire the Right Skills

We have already talked about the importance of engaging an experienced local contractor. We should probably have led with how critical it is that you work with an experienced local real estate agent.

To succeed with flipping houses, you need to first identify and acquire the right property. A real estate agent with local experience will know how to pick the right property, in the right neighbourhood, and at the right price.

A realtor also knows the taxes applicable to your real estate investment, can tell at a glance if a property can be flipped successfully, and what features the renovation must prioritize. 

Is Flipping Houses Profitable In Canada

The flip-for-profit business is growing rapidly in Canada. You would therefore assume people are driving good returns from it. The market conditions are certainly right for the business, seeing that there is a general shortage of available houses, even as prices keep rising.

Again, you need to do your homework. Just as there are people profiting from flipping houses there are many who are losing money. When starting out, concentrate on buying, renovating, and reselling one property at a time and slowly build your knowledge and experience. 

Your goal at first should not be to maximize profit but to sell as quickly as possible to minimize risk to your capital.

Where To Find Experienced Local Realtors And Contractors

The secret to making money flipping houses as a beginner is building a team of capable local professionals who will plug your skills gap. A core team will have a go-to mortgage broker, real estate agent, and experienced contractor. 

In Canada, the safest place to find these skills is on the Souqh real estate and home services market. Besides these professionals, you can also search Souqh for painters, real estate lawyers, plumbers, and all manner of real estate-focused services and contractors.The 70% Rule

home renovations

6 Questions To Ask Before Tackling A Home Renovation In Toronto

An upcoming home renovation conjures a cocktail of emotions. On one hand you are happy and excited and on the other you can’t shake off that feeling of dread for what unexpected issues the project may turn up.

A home renovation is an opportunity to finally fix the features you have always hated about your house. That boxy layout, low ceilings, and the old windows made the house so inefficient, and the leaky roof that ruined your walls and furniture.

With the excitement also comes the apprehension about the size and complexity of the task that lie ahead of you. Make no mistake, a home renovation is a big, costly project with implications beyond just the look of the property.

To set yourself up for a successful renovation, planning is everything. Without a detailed plan on how the renovation will proceed, the key skills you will need, and how much it will cost, there is a real prospect for disappointment. Answering the following questions will give you a better sense of what you are signing up for before you order any materials:

Are You Renovating Or Remodeling?

Toronto is currently experienced a home renovation boom, principally because of the Covid pandemic that has forced many of us to spend a lot of time at home, either locked down or working from there. But are we all renovating?

There is a difference between a home renovation and a remodel and knowing it will help you make the right planning decisions. To renovate a house is to update it. This can either ne through a fresh coat of paint, siding repair, window or door replacement, changing tapeware, sanding and resealing your wooden floors, etc. It typically makes cosmetic improvements and maintains the overall structure of the house.

A home remodel on the other hand makes a structural alteration to the house. The goal is usually to turn an old house into a new one. It may enlarge or add a room, replace the roof, knock down walls to improve layout, and rearrange the plumbing and electrical wiring.

So knowing the scope of the work involved will help you plan properly and to know what permits, if any, are required. It also informs how you word your contracts with contractors, which helps to prevent disputes.

What Is The Goal Of The Home Renovation?

Home renovations take different forms. Some are a simple matter of sprucing up the exterior with a lick of paint. Others give the property a complete facelift, with a fresh paint job inside out, new floors, a brand new kitchen or bathroom, and new built-in cabinets. The latter is more complex and will require careful planning and budgeting.

Knowing the goal and true scope of the renovation will ensure that you set a realistic budget and timeline for your project. As well the time it takes to do the actual renovation, factor in the time it takes to order materials and have them delivered. A custom bathtub order for example can take a few weeks to close. 

Do You Need A Building Permit?

Typically, a renovation does not require that you pull a building permit with the local planning authority. But it may entail knocking down a cracked wall, replacing a door or window frame, repairing the foundation, and other works that may affect the structural integrity of a house. 

Some of that work may require that you pull a permit with the City of Toronto’s planning department. You may also need to have the work passed off by a building inspector before you proceed with your project. All that adds to the cost and time it will take to complete your home renovation and needs to be planned for.

How Much Time Do You Have?

Some renovations are such that you may not be able to live in the house while the renovation work is ongoing. Paint fumes, dust, and noise can all make it unsafe or uncomfortable to live in the house. 

If you have to seek alternative accomodation for the duration of the renovation, you will have to make arrangements in time. So it is critical that you know in advance how soon you can return home. Again, it is important that you set a realistic timeline for the project. 

Underestimate the work involved in the renovation and you may find yourself stuck between your unfinished new home and the old one that you must vacate. A costly hotel stay may be your only option.

Will The Renovation Affect Vital Services?

Will the renovation interfere with the plumbing or electrical wiring? If so, you will need specilist skills. For any electrical work especially, there are extreme safety risk with the DIY option. Unless you have opted for a turn-key home renovation service with a contractor, you will need to hire fully licensed and insured electricians, plumbers, and builders.

If you will be living in the house while it is under renovation, it is possible that you may have to survive without your municipal water or electricity for some time while technicians fit new hardware or instal equipment. You have to prepare and budget for this.

Do You Have A Plan For The Demolition And Clean-Up?

When setting a timeline for a home renovation it is quite easy to miss the demolition and post-renovation clean-up as two important parts of the project. While renovations aren’t usually as messy and disruptive as remodels, some involve a bit of demolition work that you have to plan for.

The post renovation clean-up also takes time and resources and will, thus, need to be planned for. Do you have the transport for the rubble disposal? If you don’t, that’s another cost you need to budget for. And even if you have a truck that you can use for this, you will need fuel for it and some manpower for the work. It will also mean that you may not be able to move in as early as you envisage.

How Much Of The Work Will You Do Yourself?

Are you taking the DIY route? Doing so may save you some money, but be sure you are not biting more than you can chew. Painting, updating cabinet door and drawer handles, and other light decor stuff are fairly approachable projects if you’re a keen DIYer. But roof, siding, electrical, plumbing, and floor repairs may be out of your wheelhouse.

Attempting tasks for which you lack skills or equipment are best assigned to professionals. To avoid plunging your project into chaos and failure, be ruthlessly honest when assessing your DIY skills. 

So where can you find experienced home renovation contractors in Toronto?

Search Souqh For The Best Local Home Renovation Contractors in Toronto

Horror stories abound about home renovation projects that went off the rails because a property owner hired an inexperienced contractor. And with a renovation project that may entail hiring several different tradesmen, there’s always the chance of making one bad choice.

Souqh is where homeowners in Toronto are turning to for finding trusted local contractors. We are a free-to-use real estate and home services marketplace where you can search, compare estimates, and connect with local contractors. You can vet contractors based on their location, specializations, experience, average response time, and reviews.

Whether you are looking for a builder, plumber, painter, tiler, roofer, or all of them, Souqh is where you should be. Find a qualified and experienced local contractor and get started with you home renovation with confidence here.

digital marketing for contractors

5 Questions To Ask Before Joining An Online Marketplace


The toughest job for any service provider or contractor is finding clients. What makes it harder is that regular marketing channels are either saturated, too expensive, or take too long to bear fruits. As a result, even industry veterans go through dry periods, where they can hardly find any work. 


To improve the odds of getting that first, or next customer, you may need to get more visible to potential clients. Joining online marketplaces is one way of doing this. 


Online marketplaces are a tried and true lead generation tool. But seeing there are quite a few of them around, which ones should you join? You will be committing quite a bit of your time there, so it’s a decision you should think through. 


To help you with the decision, we have 5 questions that you should ask yourself before joining an online marketplace:

Ask Yourself These 5 Questions Before Joining An Online Marketplace


thinking emoji1. Does my target customer shop there?


There is no point in joining a marketplace that is frequented by millions of users that do not need the services you offer. Identify your target customer and then find out if their profile would fit with the audience of the marketplace you’re considering.


Souqh, for example, is a place where home buyers and homeowners come to find service providers. Homebuyers can search the marketplace for realtors, real estate lawyers, mortgage brokers, and movers, among other service providers. 


On the other hand, homeowners can rely on Souqh to connect them with contractors. These could be electricians, handymen, or plumbers. Souqh is a perfect fit for any of these contractors and professional services because it’s built for the same people they’re targeting – home buyers and homeowners.



2. How Much Visibility Will I Get?


At the end of the day, you are joining the marketplace to boost your visibility to target prospects. So, first, it should be easy for them to find your listing on the marketplace. Secondly, there should be enough real estate for you to showcase your brand, list all your services, and promote your business to prospects.


Souqh, for example, will give you your own storefront where you can list your services, display your reviews, and start a conversation with interested prospects. 


A search feature on the homepage helps prospects find you, first by your service and, secondly, by your city. As long as you have properly optimized your storefront, it should not be difficult for customers to find you. By paying a small fee you can also get your storefront featured on the homepage, which boosts your visibility.

3. What Are The Costs Involved?


Some online marketplaces are free to use while others are paid. Some payments are one-off joining fees while others are monthly subscriptions. If you have researched the marketplace well, it could potentially bring a lot of business your way, so a small fee should be a small price to pay.


That said, you should weigh the cost of listing on the marketplace against the potential benefits. Search and find out how many businesses like yours are listed on the marketplace. If you find that there are quite a few, it is possible they are getting their money’s worth and that you may too.

4. What Tools Does The Marketplace Provide?


If the marketplace is not free, you will want to know what you are paying for exactly. If it’s just to get yourself in front of more people, then there better be warm leads. Otherwise, you should expect the marketplace to at least provide tools that help you automate some of the work. 


Some marketplaces integrate with social media platforms so customers that have been satisfied with your work can recommend you to their followers with a simple click of a button. Some allow you to advertise on the platform at a low cost.


For its part, Souqh is built as an end-to-end platform for home buyers and owners. A home buyer, for example, can find mortgage financiers, lawyers, and movers all within the platform. They can even send an invite from within Souqh to their preferred service provider if they find they are currently not on the platform. That benefits everyone, including service providers. 


For service providers specifically, Souqh allows you to create, share, and e-sign your documents in one secure portal. Not just that, all your communications with clients can take place right within your Souqh store. 


More importantly, clients can pay you right within Souqh using a payment method that works for both of you. This reassures prospects of the security of their data and their privacy, which helps to close deals faster.



5. Are There Any Incentives For Users?



It is great that the marketplace provides tools for service providers to find prospects, negotiate and close deals, and receive payment in one secure portal. But what about the prospects – the reason that brought you to the marketplace? What incentives are there to keep them coming back?


Users typically don’t pay to use marketplaces so they can easily go look for service providers elsewhere. Souqh gets this and has an automated system where users earn credits every time they transact or invite a service provider to the platform. 


The credits users earn can be used to pay for future services. So users are motivated to use Souqh more frequently because there is a direct financial benefit.


Find Customers And Grow Your Business On Souqh


Are you a contractor or professional services provider like a lawyer, realtor, or mortgage broker? Souqh can connect you with potential clients and help scale your business at a more manageable expense. Get started with Souqh here.