How to discount a house for being ugly when doing an analysis?

Question

I'm looking at a house tomorrow as a potential next value-add project (either flip (primary) or BRRRR (secondary)) that can only be best described as "ugly."  Was built in early 60s and if I had to categorize the style would say poorly executed art-deco.  It is smooth stucco with a flat roof.  It is definitely VERY different than the typical ranches and craftsmen style homes in the area.  That being said, the numbers are interesting.  In my initial analysis I factored in a 10% discount for being ugly.  Is that enough?  Anyone have experience trying to flip an ugly house in a great area?

Coley Mitchell · Answer

Appreciate feedback Account Closed.  Yes, it is def "cosmetic ugly."  Layout is pretty good actually.  Would remove a couple a half walls and could have a very open, flowing floorplan.

Account Closed · Answer

@C Coley Mitchell Best of luck! I'd much rather buy the 'ugly' house in a great area then the opposite. That's got the potential. Rather than hope some renters/buyers will seek out your great home in a bad area.

Account Closed · Answer

@C Coley Mitchell Would you say its mostly cosmetic 'ugly'? If that is the case its mostly having trusted contacts and a team ready to modernize the house. Its about getting together a plan, getting the estimates then and seeing past the ugly. Wallpaper removal, replacing carpets and cabinets can often be done on the relative cheap. Having a bad house layout and other factors is where I imagine you want to go all in factoring in your risk and whether its a good buy as a rental or flip.

If the numbers look good then the cosmetic ugly you can look past. Just my opinion.