Go to the Globe and Mail homepage

Jump to main navigationJump to main content

Cindy Wennerstrom quit her job in sales and marketing to indulge her passion for real estate four years ago. (Peter Power/Peter Power/ The Globe and Mail)
Cindy Wennerstrom quit her job in sales and marketing to indulge her passion for real estate four years ago. (Peter Power/Peter Power/ The Globe and Mail)

Property

The list of don'ts for flippers Add to ...

Seven things not to do:

  • Don’t underestimate the amount of time it will take to sell the property. Have enough money to cover the mortgage, property taxes and maintenance costs for as long as it takes.
  • Don’t underestimate the cost of the renovation, or overestimate the ultimate sale price.
  • Don’t neglect to factor in the smaller items in your renovation cost projections. People worry about the big-ticket item but things like new doorknobs add up.
  • Don’t call an accountant after the deal is done. How the financing is structured can have significant tax implications.
  • Don’t underestimate the time it will take to manage your tradespeople. Get several contractors working at the same time in different areas. Linear planning will result in higher costs.
  • Don’t rely on shoebox bookkeeping. Clean records will result in tax savings.
  • Don’t lump all costs together. Some will be immediately deductible, others can’t be written off until the property is sold. Understand the difference and plan accordingly.

Source: George Dube, a tax partner with Kitchener, Ont.-based Dube & Associates Chartered Accountants

More related to this story

 

In the know

Most popular video »

Highlights

More from The Globe and Mail

Most Popular Stories