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Fixing and flipping properties might feel like a daunting task at first, but once you get into the swing of things – the planning, the vision, your long-term goals – the formula comes clearly into focus.
And while design trends come and go, sensible remodeling always goes the distance. When you’re anticipating making a profit off a property, it’s important to consider which renovation decisions are worth the investment and which ones are better left to the new property owners once flipped. With these tips, your next fix-and-flip project is sure to fall within your intended budget and sell faster.
Look at similar properties in the area
It might feel tempting to overdo it and create a property that outshines the rest but pump the brakes while you’re ahead. Only spend on upgrades that add value. If you’ve read this before on our site (and we know you have), real estate development will always come down to three key factors:location, location, location!
Don’t renovate to the point of overpricing the property for its market. Within the same vein, don’t skimp out on upgrades that could make the property a great competitor. It’s critical that before you even buy that you do your research. Look at things like regional employment rates, age demographics, and what other developments are – or are not – happening locally.Investigate other residential properties on the market and how they stack up against yours. This will not only give you a general idea of whether a property is investment material, but also provide you with the insight to determine what your renovation budget can be.
A tennis court or pool might look great from the outside, but don’t bet on every interested buyer being interested in expensive property upkeep. The bottom line? Make sure whatever changes you make will maximize your return on home improvements.
You only make a first impression once
The importance of curb appeal can’t be overstated. If you’re flipping an old Victorian with high ceilings, large rooms, and original hardwood flooring, but the exterior still looks like it’s hanging out in the 19th century, consider carving out a budget for some external TLC. And it doesn’t have to take too much work or money!
Power wash and paint the siding, upgrade window casings and shutters, repair and paint the fences, plant some greenery. Cosmetic upgrades can make a world of difference, not only ensuring that prospective buyers will be inspired when walking up to the property, but also inviting them in.
Focus on the important rooms
If the kitchen is considered to be the heart of the home, it might be worth focusing more of your attention (and budget) on it, and perhaps the bathrooms too. In highly competitive residential sales markets, dated kitchens and/or bathrooms are what’s most likely to turn potential buyers away quickly.
While a complete overhaul may not always be necessary foreach of these spaces, it’s important to recognize where the money can be best spent. Be objective and make decisions as an experienced businessperson. For example, do existing kitchen cabinets need to be replaced or can they be refinished? Make the best business decision that doesn’t sacrifice the quality of the property.
Design your property so that it’s Switzerland
That’s to say – make it neutral. This isn’t your home to live in and if you’re working to flip it as quickly as possible, it’s important to remember that not everyone shares the same tastes and the last thing you want to do as an investor is turn off prospective buyers.
More costly upgrades like countertops, carpeting, or wall finishes should be both modern and clean. Choose soft, neutral colors that can appeal to the majority rather than the minority of customers who are bound to walk through the space.
It costs money to make money, and that adage is especially true for anyone who flips properties. But if you walk into a project with a clear vision, a wise strategy, and a meticulous budget, you’ll soon see the payoff and your portfolio grow. If you’re ready to explore financing options for your next fix-and-flip project, contact Temple View today.