What are the most expensive parts of house flips?

Question

I haven't rehabbed a house yet, but when doing my math, I have found that tile floors, new cabinets, new windows, and new appliances are the most expensive.

This is assuming that the air-conditioner and roof doesn't need repair.

Danielle D. · Answer

Depending on where you are in the country, sewer line replacement is a big cost (almost always needed in Denver).

Karen Bickford · Answer

I would say updating plumbing and electrical. Plumbers charge more than doctors lol. Luckily I am married to one.

Stacey Olson · Answer

We just completed a rural flip (5 acres, a decent double wide, a couple of outbuildings) that was primarily cosmetic.

To begin with, our biggest expense was the kitchen rehab (gutted the kitchen and after all was said and done we included all appliances which we would not have if it wasn't a mobile home, but because it was a mobile with a great view, a fabulous and massive front porch, and a lovely orchard including 5 different types of fruit trees, etc. adding all new appliances was a recommendation made by our mentor as a final selling point that has gotten great feedback thus far).  But here's the kicker, after our first offer and subsequent inspection, we are going to have to do something with the well which will potentially end up taking a big  bite.  We're looking at about 3-5k if we just go with a UV filter or up to $17k if we have to dig a whole new well.

The upside of this recent development is that a new well or improved system will ultimately add to the value of the property, the downside is the issue resulted in a rescinded offer that now has us back on the market.

In terms of tile (we tiled the kitchen and two bathrooms), we had a general contractor lay the tile (he was experienced and therefore quick.  He charged by the hour), but we did the grouting ourselves which was relatively quick and hard to screw up; it was a great learning experience and well worth not paying someone else to do. The tile itself was inexpensive (sorry, I don't remember the per sf cost at the moment, but I can say that we went to a discount tile retailer for bathroom tile, and great small quantity closeouts were available for huge discounts (like way cheaper than home depot), and we used home depot 12x24 tile for the kitchen floor for a few hundred bucks).

The other big expense would have been the roof, but we were able to leave that one alone (thank God!).  Outbuildings didn't have to be touched beyond basic clean out.

I agree with others who have stated that plumbing and electrical can get you, but it's so worth working with a jack of all trades general contractor who knows her/his stuff and you know codes so you can give very specific direction and have them get the job done without having to use a full-fledged plumber.

The following has nothing to do with your question about biggest expenses, but may save you big dollars in the long run:

We were given some tips that have paid off:

• vacuum out your HVAC system to the best of your ability prior to inspection (inspectors see dirt or dust and they give you poor marks and tell potential buyers that a professional needs to be brought in to clean out the system);

• run Draino through your tub/shower drains (if you're leaving existing tub/shower in tact) prior to listing and test the drains to make sure there is good flow (we might or might not have used the tubs to clean paintbrushes, which resulted in REALLY slow drains); 
• If you have a hand dug or shallow well, run bleach through it (lots of instructions online as to how to get bacteria out of the system when a hand dug well is involved) and flush the bleach immediately prior to inspection.

I hope some of this helps.  Oh yeah, changing out electrical panels is a pain (yes, often necessary, and if not necessary, worth upgrading).  We chose to leave the functioning but unpopular brand of panel in tact with the knowledge that it might get called out in inspections and may end up being worth replacing to get a deal through, but there is also the chance that it won't get called out or won't get priority when a buyer is asking for other tasks to be taken care of.  We left that one to fate, and our initial buyer saw the inspector's comments about the brand and recommendation of replacement, but the buyer chose not to ask for replacement.

Feel free to ask questions if you have any!

Good luck!

Brian Pulaski · Answer

Assuming no major mechanicals, roof or siding work... Windows, cabinets, appliances, granite and flooring (hardwood install and refinish in my case). I do my own tile and found that this has never been a substantial cost for me.

What are the most expensive parts of house flips?

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