Appliance allowance on flips?

Question

I am considering a different strategy for a flip than how I usually do it. We are working on a flip that has an ARV of $125K, and I am planning on putting in stainless appliances. I was just wondering if anyone else does a system where they provide an allowance of $xxx for appliances, and the buyer can select them. I have no problem purchasing them, but I also know that appliances tend to be one of those personal preference things that might help if the buyer can select their own?

Mike G. · Answer

Unless the house is already sold to someone, this sounds like a bad idea.  What happens when somebody chooses all their custom colors, appliances, fixtures, etc, and then they can't get a loan or decide not to buy the house?  Then you have a house custom to one person's specific tastes that you are trying to sell to someone else.

Also, not having a finished house during showings is a mistake.  We once showed a house without appliances, but we had photos of the appliances that would be installed for people to see.  Many people saw the house but we received no offers.  The next week we installed appliances, and that weekend we had 6 people see the house and 5 of them made offers.

J Scott · Answer

The issue with that approach is that the house won't have appliances during showings, and that's going to be a huge visual selling point when marketing a $125K house.  If you do offer the allowance, I would have appliances in the house as well during showings (just remove them at sale and move them to the next house).

Walt Payne · Answer

@Mike Grayford  I was not talking about customizing the entire house. I would not do that at this level. I am considering the possibility of allowing them to select the appliances, based on a specific budget. I would also only purchase them within a short time of closing.

Walt Payne · Answer

@J  Scott  That was one of the issues I was wondering about. I assume they should be the ones I would have put in myself, so that they see the level of appliances that the allowance buys them? There will be a pretty good margin on the flip,  so I want to try to make it a bit of a custom build by allowing them to choose what they want to help sell it quickly.