In the mid-2000's, house flipping came to symbolize an era of ill-gained profits and subsequent collapse of the real estate market. Is house flipping bad?
The Ethics of Flipping
When a house is remodeled just enough to pass the "smell test" from the buyers and inspector, but not good enough to last long-term, it is considered a bad house-flip. Examples: using Chinese-made drywall that will not turn bad for several years or unpermitted, sub-standard electrical work.
But when you lightly remodel the home and everything is made transparent to the buyer, it returns to what it has always been: buying, fixing, and selling of homes for a profit. As long as your cost-saving remodels are clear and obvious, it is not a dishonest house-flip.
Concentrate on these areas:
1. Focus On Kitchens and Bathrooms
Because: Kitchens and baths are what everyone looks at.
Once the lockbox is opened and the door swings open, the first place that buyers gravitate to is the kitchen. After that, the bathrooms. If you had to choose only two rooms to remodel, they would be the kitchen and master bathroom.
2. Improve Your Kitchen Lighting
Because: Dim lighting in the kitchen not only does little to show off your new remodels, it's depressing. Plus, buyers think you are trying to hide something.
Best thing of all is that it doesn't have to cost a lot.
- Go super-cheap by increasing bulb wattage of existing fixtures (safely and within manufacturers' specifications) with LED bulbs.
- Changing out those dull center-of-room ceiling lights with recessed lights.
- Pendant lighting will always be popular in the kitchen because it brings the light source closer to the work surface.
3. Refinish or Reface Kitchen Cabinets
Because: Cabinets can comprise 50% or more of your kitchen's wall space, so make it look good.
At open houses, real estate agents tend to hang out in the kitchen. Buyers start in the kitchen, loop around the house, and end up in the kitchen again.
On top of homeowners' perennial love for kitchens, this means that you should concentrate on this key area. Short of dropping $50,000 on new cabinets, go inexpensive by:
- Refacing existing cabinets.
- Strike a balance between attractive and rock-bottom cheap with self-installed ready to assemble (RTA) cabinets or IKEA cabinets.
4. Strip Away Carpet and Expose Hardwood
Because: Hard flooring, especially solid hardwood, is a trend that will never go away.
If you flip up a corner of carpet on your flipper and discover solid hardwood flooring, you're in luck. Remove the carpet and sand the floors.
Don't have hardwood underneath? Install engineered wood flooring, laminate flooring, ceramic/porcelain, or luxury vinyl flooring (LVF).
Kitchens should always have hard flooring, preferably ceramic/porcelain or engineered wood. Bathrooms should always have water-resistant hard flooring like LVF or tile.
5. Spiff Up Your Home's Curb Appeal
Because: Buyers will not even want to have their agent open up that lockbox and go inside if the outside does not attract them.
All that talk about curb appeal is 100% spot-on. Fair or not, psychologists have found that it's human nature to assign superior qualities to a person with a beautiful face.
It works the same way with your house: if its facade (or face) is stunning, potential buyers will be far more forgiving of deficiencies within the house--to a point. Exterior paint cannot make up for sagging floors and broken windows, but it will soften the edges of poor interior paint or outdated appliances.
Most importantly, stunning--or at least acceptable--curb appeal will get those buyers through the front door.
Forget About These House-Flip Remodels
- Slab Granite: Not only does the cost of slab granite drive up the total cost of your house-flip, but designers say it's a fad that is long gone.
- Piano Finish: Piano finish flooring, a super high-gloss finish, does not appeal to a broad range of home-buyers. Stick to conventional lower-gloss finishes.
- Plank Flooring: Wide-plank wood flooring is beautiful stuff, but its high cost usually will not be returned upon sale.