How To Flip Houses In Wisconsin: Step By Step (2024)

Wisconsin boasts an active and growing housing market that investors may want to pay closer attention to. In particular, the state's strong economy, relative affordability, and diverse industries have led to steady population growth. Millennials, in particular, have chosen to call Wisconsin home, which bodes well for local investors.

“The median age of the population residing in the state of Wisconsin is approximately 39.1 years of age,” according to World Population Review. That’s important on many levels, but primarily because older millennials (33 to 42 years old) have represented the largest population of buyers for the better part of a decade.

The Badger State’s largest age population is in its prime homebuying years, and those who learn how to flip houses in Wisconsin may be in line to benefit from a massive tailwind. Whether you are new to investing or simply want to further your real estate knowledge, this guide will teach you everything you need to know about how to flip houses in Wisconsin, including:

• What Is Flipping Houses?
• Wisconsin House Flipping Statistics
• How To Flip Houses In Wisconsin (7 Steps)
• How To Find Houses To Flip In Wisconsin
• Do You Need A License To Flip Houses In Wisconsin?
• How To Flip A House In Wisconsin With No Money
• Best Cities To Flip Houses In Wisconsin
• Final Thoughts On Flipping Homes In Wisconsin

*Before we begin our guide, we also invite you to view our video on How To FLIP A HOUSE For Beginners (Step-by-Step). Host and CEO of Real Estate Skills, Alex Martinez, & Stan Gendlin share how to flip a house in Wisconsin as a beginner! 

Together, Alex & Stan have completed over 1,000+ house flips. What you learn in this video will give you the confidence and guidance to successfully complete your fix-and-flip project!

What Is Flipping Houses?

House flipping is one of the most popular real estate exit strategies used by today’s most successful investors, and for a good reason: the income potential is hard to ignore. According to ATTOM Data Solutions’ latest Year-End Home Flipping Report, the average home flipped as recently as last year “typically generated a gross profit of $67,900 nationwide.”

Flipping houses has proven it belongs in investors’ portfolios, which begs the question: What is house flipping? On the surface, it’s an investment strategy that has investors buy, rehab, and resell homes for a profit. Beneath the surface, however, home flipping is an involved process that requires a unique synergy between each stage to mitigate risk and maximize returns.

Investors must buy subject properties below their market value to succeed as house flippers. Typically, doing so will require buying homes from motivated sellers or those at risk of foreclosure. Securing deals below the home’s actual value simultaneously mitigates risk and increases profit margins.

Once the homes are acquired, investors will spend money to rehab and fix them. Renovations must be specific and cost-effective, as their sole purpose is to increase the home's value as much as possible without exceeding a predetermined budget. A good rule of thumb most investors abide by is to make the home slightly better than those it will be compared to in the same neighborhood. That way, the property will receive the most attention when placed on the market.

Investors will proceed to sell the house when all the necessary renovations have been made, and the property has reached its desired condition. If done correctly, the sale price will be high enough to cover the expenses of the flip (everything from the construction costs to the loan) and provide the investor with an attractive payday.

Read Also: Finding Motivated Seller Leads: Free & Paid Tactics

Wisconsin House Flipping Statistics

Here’s an overview of the vital data and metrics that every aspiring house flipper in Wisconsin must know:

• Average Home Value: $267,008
• Median Sale Price: $285,300
• 1-Year Appreciation Rate: +5.2%
• Median Days To Pending Sale: 16
• Median Days On Market: 44
• Homes For Sale: 15,456
• Homes Sold: 4,250
• New Listings: 5,758
• Months Of Supply: 2
• Foreclosure Rate: One in every 9,153 households
• Population: 5,892,539
• Median Household Income: $67,080
• Unemployment Rate: 4%

*All Wisconsin housing market statistics are as of the second quarter 2023.

How To Flip Houses In Wisconsin (7 Steps)

Investors who want to learn how to flip houses in Wisconsin should start by following the seven steps outlined below:

1. Find A House-Flipping Mentor
2. Research The Local Housing Market
3. Find & Analyze Distressed Properties
4. Raise Capital To Fund The Deal
5. Close On The House
6. Renovate The Property
7. Resell The House

1. Find A House-Flipping Mentor

While there’s no reason new investors can’t start flipping homes in Wisconsin by themselves, they have every incentive to seek the help of a mentor. Aspiring investors will do themselves a huge favor by asking for help at the beginning of their careers. Collaborating with an experienced home flipper provides invaluable guidance and knowledge that can’t be found in a book.

Having a skilled leader by their side enables new investors to minimize risks, streamline operations, and greatly enhance their odds of realizing success. Moreover, a mentor can foster confidence, empowering new investors to take that crucial first step. With proper guidance, a first deal can transform from an insurmountable obstacle into a productive stepping stone, unlocking the untapped potential within a new generation of investors.

Ready to start house-flipping in Wisconsin? Join Alex Martinez at his FREE training to learn how to get started with house-flipping and wholesaling!

2. Research The Local Housing Market

Learning how to flip houses in Wisconsin starts with seeking the most reliable and trustworthy resources. With the resources listed below, new and experienced investors will have access to the data they need to kickstart their careers:

• Zillow Housing Data Research
• Zillow’s Wisconsin Market Overview
• Redfin’s Wisconsin Housing Market Overview
• Wisconsin Realtors Association Market Data
• Realtor.com’s Wisconsin Market Overview
• ATTOM DataSolutions’ Wisconsin Real Estate & Property Data
• SoFi’s State Foreclosure Data
• U.S. Census Bureau’s Wisconsin Data
• Bureau Of Labor Statistics’ Wisconsin Economic Data

3. Find & Analyze Distressed Properties

In the emerging Wisconsin real estate market, investors are awarded several opportunities to discover and evaluate distressed properties. However, aspiring investors are advised to embrace the simplicity and effectiveness of the 70% rule. While far from perfect, the 70% rule is an excellent place for investors to start analyzing properties until they can get more experience.

Investors must determine the property’s after-repair value (ARV) to get the ball rolling. As its name suggests, the ARV is how much the subject property will be worth once it is restored to its desired condition. Investors may either use an ARV calculator or simply use nearby “comps” to determine a home’s ARV.

With the ARV in hand, the next step is multiplying it by 70% (or 0.70) and subtracting the estimated rehab costs. The resulting number represents the maximum allowable offer (MAO), the threshold investors must remain under when purchasing a deal. Investors can create sufficient profit margins for a compelling return on investment if they stick to the MAO.

Here is the formula:

ARV - Fixed Cost - Rehab Costs - Desired Profit = Maximum Allowable Offer (MAO)

4. Raise Capital To Fund The Deal

Moving forward, investors need to take steps to secure funding for the deal they just analyzed. Funding can come from many sources, including their bank accounts, but those familiar with the industry are more than aware that borrowing coincides with more upside.

Firstly, borrowing funds from external sources allows investors to preserve their savings and avoid financial constraints. Secondly, utilizing external capital empowers investors to scale their business in a manner that would be challenging if they solely relied on their resources.

Instead of using their capital, investors should look into using a private or hard money loan. Private and hard money loans are particularly well-suited for home flippers. Although these sources often have higher interest rates, the additional costs are justified by how quickly they can place funding in investors’ hands. Investors can act quickly in a competitive market by accepting a higher interest rate, sometimes reaching 15% or more.

5. Close On The House

As an escrow state, investors can expect the closing process in Wisconsin to follow these steps:

• Negotiations: The real estate transaction commences with negotiations, where both parties agree on the terms that are then formalized and documented in a purchase agreement. This agreement covers all aspects of the impending transaction, including the purchase price and closing date.
• Title Search: To minimize the risk of future ownership disputes, investors are advised to conduct a thorough title search and verify the property's title and ensure clear ownership.
• Inspection: At the investor's discretion, a home inspection may be conducted to identify any potential deal-breaking issues. Concerns are addressed, and both parties agree on how to proceed with the findings.
• Final Walkthrough: Just before the closing, a final walkthrough takes place to verify that the property is in the condition specified in the purchase agreement
• Closing: The closing process, overseen by an escrow company or each party’s representatives, involves the transfer of ownership and funds between the parties involved.
• Recording: The transfer of ownership is officially recorded in the local Recorder's Office, finalizing the new owner's legal rights.

6. Renovate The Property

Investors should prioritize cost-effective renovations that enhance the property's curb appeal and overall value. Investors must exercise discipline and refrain from indiscriminate spending on renovations. Instead, the focus should be on projects that yield the highest return on investment (ROI). By strategically selecting renovations, investors can maximize the potential increase in the property's value.

According to Remodeling Magazine, the renovations that return the most money to investors in Wisconsin (and the rest of the East/North/Central regions of the United States) are:

• Manufactured Stone Veneer: Recoups 102.6% of the original cost
• Electric HVAC Conversion: Recoups 97.7% of the original cost
• Garage Door Replacement: Recoups 80.4% of the original cost
• Minor Midrange Kitchen Remodel: Recoups 74.3% of the original cost
• Vinyl Siding Replacement: Recoups 73.1% of the original cost

Upon closer look, even the best renovations don’t return more than they cost. However, the best investors have realized that renovations only need to add one thing to the home: attention. Any addition or renovation that makes a home more attractive adds an intrinsic value that can’t be underestimated. Projects that increase demand for a home can stir up competition, ultimately driving up the price when the asset hits the market.

7. Resell The House

Resell the house once the property has been restored to its desired condition. Better yet, investors with the bandwidth to multitask should consider marketing the home for sale before it’s even completed. Either way, attempt to sell the property as soon as possible.

The primary objective is selling the property at a list price that exceeds the total investment made. If the property was acquired significantly below its fair market value and the renovations have substantially increased its worth, the investor should be well-positioned to generate an attractive profit.

While it may cost more upfront, investors should consider working with a real estate professional, like a Realtor or an agent. Their fees can be steep, but a genuinely gifted professional should be able to sell the home faster and for more money than the cost of their services.

How To Find Houses To Flip In Wisconsin

The best ways to find Wisconsin houses to flip are:

• Leverage market knowledge and expertise from local real estate agents, recognizing that they know the market better than anyone. Collaborating with professionals deeply rooted in the market will uncover many opportunities.
• Access the Multiple Listing Service (MLS) through your license or by partnering with an agent. This comprehensive database contains many homeowners who are already motivated to sell their properties, providing a rich source of potential deals.
• Participate in foreclosure auctions hosted by banking institutions to bid on off-market homes. Banks often sell properties at these auctions to alleviate the burden of non-performing loans, offering proactive investors the chance to secure deals below market value.
• Visit the local Recorder's Office to identify Wisconsin homes at risk of foreclosure. With foreclosures being public record, diligent investors can locate distressed homeowners by understanding what indicators to look for.
• Implement a targeted direct mail campaign aimed at homeowners in the desired area. While only some recipients will respond, a single successful deal can make the entire campaign worthwhile.
• Explore neighborhoods by driving around and identifying neglected properties. While not always the case, overlooked assets may reveal owners more inclined to sell, presenting potential opportunities for investors.

Do You Need A License To Flip Houses In Wisconsin?

Holding and maintaining a real estate license is not necessary to flip homes in Wisconsin.

However, acquiring a real estate license can offer valuable advantages. Although it entails paying annual fees and passing regular exams to maintain professional status, investors gain access to a nationwide network of agents and their best tool: the MLS.

Read Also: How To Get MLS Access: The (Ultimate) Guide

How To Flip A House In Wisconsin With No Money?

Flipping houses in Wisconsin doesn't require investors to use their own money. Instead, they can leverage funds from private and hard money lenders who are actively seeking profitable opportunities themselves. This eliminates the need for dealing with traditional banking institutions, credit checks, and lengthy approval processes.

Using private and hard money loans provides quick access to cash and speeds up the deal-making process. Additionally, investors can explore alternative strategies like wholesaling, which involves acquiring property rights and selling them to end buyers for a fee, requiring minimal capital investment.

Best Cities To Flip Houses In Wisconsin

The Wisconsin real estate market is full of opportunities, but the following cities may be the best places to flip real estate:

• Milwaukee: With a median home value of $189,467, Milwaukee’s prices are well below the state average. As a result, the city has seen an influx of demand as buyers seek affordable living situations. As a result, investors here will find plenty of opportunities to fix and flip homes.
• Madison: Located west of Milwaukee, Madison attracts investors with a higher tolerance for higher home values. With a median home value over six figures above the state average, flips require more capital, but the demand and profits may be worthwhile.
• Green Bay: Known for more than its famous NFL team, Green Bay looks like a great place to learn how to flip homes in Wisconsin. The median home value is incredibly affordable, and budget-conscious investors will appreciate the low barrier to entry.

Final Thoughts On Flipping Homes In Wisconsin

Flipping homes in Wisconsin has emerged as a highly profitable venture for numerous investors but demands diligent attention to detail. Those who approach it with thoroughness and follow the necessary steps can optimize profits while minimizing risks.

At Real Estate Skills, our team of experts is ready to provide you with the tools you need for flipping houses in Wisconsin. We're committed to providing the knowledge, resources, and support you need to navigate a Wisconsin property flip successfully. So avoid common mistakes and maximize your returns by leveraging our expertise.