Investor · Jackson, MS · Member since 2021 · 657 posts · 559 votes
1y
There is more to returns than this question would allude to. If I can do a cosmetic flip and have the crews that can knock it out in a few weeks so we can relist it and do three in the time it takes to do a full rehab which will have my money and attention tied up for months, the simple flip would be my choice. In a full rehab you will invariably find the unexpected which throws the timeline off and costs money (hard money, holding costs, utilities, etc.) If your goal is to get your money turned, a 10% return in a month versus 40% in 6 months seems to be a no-brainer. But if you have the financial resources and the trades ready to rock, run the numbers and see what option works best for your specific project. We have switched strategies on some projects when we ran numbers and getting in & out is also the goal on a flip.
Investor · Jackson, MS · Member since 2021 · 657 posts · 559 votes
1y
There is more to returns than this question would allude to. If I can do a cosmetic flip and have the crews that can knock it out in a few weeks so we can relist it and do three in the time it takes to do a full rehab which will have my money and attention tied up for months, the simple flip would be my choice. In a full rehab you will invariably find the unexpected which throws the timeline off and costs money (hard money, holding costs, utilities, etc.) If your goal is to get your money turned, a 10% return in a month versus 40% in 6 months seems to be a no-brainer. But if you have the financial resources and the trades ready to rock, run the numbers and see what option works best for your specific project. We have switched strategies on some projects when we ran numbers and getting in & out is also the goal on a flip.
Contractor/Investor/Consultant · San Diego / Phoenix · Member since 2021 · 12k+ posts · 15k+ votes
1y
I've done both. It's really all about the bottom line $$wise. Alhough I prefer doing high-end stuff, if I can get in and out of a small lipstick project and net more $ per days spent, then that's the way to go...
While down to the studs can look more intimidating, the advantage there is a clean slate. What I get leery about is knowing a project is a full rehab but the walls aren't open. These houses often have a lot of unknown "demons" versus something that is fully open has less surprises and can actually be less of a project.
We all know even cosmetics have surprises pop up too. It's all about the numbers and managing risk vs reward.
While down to the studs can look more intimidating, the advantage there is a clean slate. What I get leery about is knowing a project is a full rehab but the walls aren't open. These houses often have a lot of unknown "demons" versus something that is fully open has less surprises and can actually be less of a project.
We all know even cosmetics have surprises pop up too. It's all about the numbers and managing risk vs reward.
Yep, always best to 'take it to the studs' and just start over....You never know what you'll find, and I have some stories that are great. One time, the junkies living in the place had been getting rid of their used needles by tossing them behind the medicine cabinet in the bathroom...for years....that was fun opening up that wall, Lol.....