My First Flip - when to draw the line in the sand.

6 Replies

HI Folks,

Thanks in advance for anyones responses.  

So I am analyzing the potential rehab cost of a potential flip.  It is a classic 3 bed 1 bath 1100 sq ft ranch in CT.

My concerns are that I am potentially OVER flipping it.  (I haven't actually bought it yet- just geeking on the flipping materials and labor budget).

It has hardwood floors throughout, but they would need to be refinished at a cost of about $2600.00 I weigh that with the cost of all new carpets about $1000.  

Same idea with kitchen appliances (it has a stove, fridge, dishwasher, microwave Black appliances) Do I swap them out and keep them for a rental property and put new SS appliances in? But the cost on that is about $2000.


Do you swap out EVERY light switch and outlet to make it universally match and cohesive or leave some of the old ones and just update kitchen and baths outlets and switches etc? 

To my experienced flippers, where do you draw the line?


-Michael

@Michael L Sakey depends on the price point of the house. If it's a higher end or mid level flip, refinish the hardwoods, new appliances. Lower priced flip, I would carpet and keep the black appliances.

I always replace switches, outlets and covers. I feel like it's a low cost item and makes the space seem nicer, in a subtle way.

It depends on 1 thing more than anything else. What is on the other flips in your area. If you are sell black appliances and carpet while everyone else is selling stainless and hardwood then good luck trying to sell for top dollar. But the other way around you will sell quicker and possible at a higher dollar. But it can also be a waste of Money if the end buyer doesn't care. I used to do skip trowel texture till I found out buyers were just fine with knock down. 

The point of a flip is to make it look new. Do not skimp on little things like outlets and switches and covers. If you do people will wonder what else you forgot to do. They are super cheap as well. I usually put carpet over hardwoods in my area just because most of the other houses will have hardwood (not refinished) and it sets me apart. I would switch out the appliances for stainless steel ones.  I think that is part of the appeal to buying a flip. You can sell the old ones.

@Michael L Sakey

It depends on what BUYERS expect in your market.  And what is your competition offering?

Too often I find flips sitting on the market well past 100 days because they skimped on the rehab.

Buyers don't care about your budget and ROI if they don't like the house they're not going to buy it!

Good luck! ;)

Free eBook from BiggerPockets!

Ultimate Beginner's Guide Book Cover

Join BiggerPockets and get The Ultimate Beginner's Guide to Real Estate Investing for FREE - read by more than 100,000 people - AND get exclusive real estate investing tips, tricks and techniques delivered straight to your inbox twice weekly!

  • Actionable advice for getting started,
  • Discover the 10 Most Lucrative Real Estate Niches,
  • Learn how to get started with or without money,
  • Explore Real-Life Strategies for Building Wealth,
  • And a LOT more.

We hate spam just as much as you