Flipping houses has been marketed as the easiest and fast way to quick riches in real estate investing. Lots of real estate investors have no clear reason why they should flip houses, so they approach the business wrongly.

Here are a few reasons why you should be flipping houses as a business model.

1. You do not need a big capital investment

Wholesaling houses, or flipping houses, involves buying houses low then flipping them at a higher price for profit.

You usually flip the house to another real estate investor cash buyer.

Once you locate a cheap house, you sign a contract to buy the house. The earnest money needed for this is little, from $100 to $500 or even less.

You then take the contract to a real estate lawyer or title company to begin title work.

As title work proceeds, you identify a buyer, usually a real estate investor. Depending on the profit potential at hand, you sign a second contract to sell to the real estate investor.

You can do a contract assignment where you assign the contract to the real estate investor. In this case, the wholesale buyer buys the property on your behalf. In other words, the real estate investor gains the right to buy on your behalf.

Generally, you do a contract assignment when you do not stand to make a lot of money. The wholesale buyer will know how much you make in the deal.

You can also do a double closing, also called a simultaneous closing, where you buy the property, the flip it to another real estate investor on the same closing table. The contract you sign is a contract where you buy the house, then another one where you sell.

So in this case, you do two transactions, one where you buy and one where you sell. Your wholesale buyer will not find out how much you earn in the transaction because you sell the property directly to him.

Simultaneous closing is better where you stand to make more money in the deal so you do not want the real estate investor wholesale buyer to find out.

You probably just need earnest money to close such a transaction.

2. It needs little work

When flipping houses, you do not have to rehab houses, the wholesale buyer does. All you need to do is locate houses under market value, then flip them to other real estate investors.

3. You make your money fast

Generally, it takes 3 to 4 weeks or faster to get paid in a wholesale deal. As long as title work is done and there is cash to close the deal, the deal is closed.

4. No hassles for management

You do not need to worry about bad tenants since you never hold houses. You do not have to worry about rehab because your real estate investor wholesale buyer is the one that does repairs, not you.

Ultimately, flipping houses will build you a healthy cash flow as a real estate investor.