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Flipping a home on a small budget

By
Real Estate Broker/Owner with Cornerstone Business Group Inc 0225086119

One of the issues I run into with clients is the costs of upgrades for their homes. They want to sell at top dollar, but they have issues with outdated aspects of their homes or the expensive upgrades prohibit them from making the changes. It happens all the time.

I just flipped a condo that had these very issues. The needs of the unit were high and the profit margin on the flip could be low if I did all of the upgrades. In the course of doing the renovation, I stumbled across multiple ways to give the home the pizazz it needed to make it more valuable without breaking the bank. 

There were two areas that really bothered me when I took on the project. The areas that didn't bother me were painting and flooring. Those two areas can transform a home quickly and on a pretty good budget. Of course, flooring can vary, but it is something that can be done inexpensively and still help transform a sad looking home into a happy home.

In this condo, the kitchen and the HVAC bothered me. The HVAC was old, and even though it worked fine, it was going to draw attention to itself because of age, and the kitchen just wasn't sexy. Actually, it was just sad. Previous homeowners had done things to improve it, but they just didn't. 

While I was doing other things on the unit, I stumbled upon a brand new HVAC system at a Habitat Restore for $350. That solved one problem. The kitchen needed a lot more work. I had contractors come by to give me bids on the flooring and they were high. In the process of deciding on flooring and working on other aspects of the unit, an auction came to town with home improvement items. I was able to buy enough ceramic tile for four important areas of the condo for 60% less than the bids. I bought the tile, installed it myself over a weekend and it turned out amazing. 

That still left the cabinets, counter-tops and lighting in the kitchen. The previous owners had installed faux brick for a back-splash and not only was it installed poorly, it darkened the room. I was determined to rid the kitchen of that faux brick, but what would I replace it with. And beyond that, what about the counters? 

By happenstance, my office administrator had a friend resurface her vanity tops with a product from Rustoleum. That started my wheels turning and I soon found that Rustolem also makes a counter-top transformation product. I bought it, installed it and it completely changed the look of the counters. I added some better lighting, tiled the floors and added a subway style back splash and boom, a new kitchen. 

Changes do not have to cost a fortune and they can be as simple as adding a few lights or resurfacing a counter-top. There is always a way to make a home more desirable, and it doesn't have to cost a fortune.

 

 

 

 

 

Resurfaced counters

Subway backsplash

Recessed lighting over cabinets and sink and ceiling light

Ceramic tile floors

Less than $1000 in changes

Comments(19)

Paul S. Henderson, REALTOR®, CRS
Fathom Realty Washington LLC - Tacoma, WA
South Puget Sound Washington Agent/Broker!

Fortunately you are more meticulous than most of the flippers I have witnessed recently. I salute you. What gives most flippers a bad reputation is the bad paint job and the poor cleaning and substandard repairs they attempted. Most will not stand up to the high price and a good home inspection. 
Happy Sunday Mike Cooper, GRI 👍👍👍

Sep 20, 2020 12:20 PM
Mike Cooper, Broker VA,WV

Paul, I did two this year and both sold for full price with no concessions. That meticulous streak I have pays dividends. Those two properties were the highest sales in both neighborhoods this year. 

Sep 20, 2020 02:53 PM
Sham Reddy CRS
Howard Hanna RE Services, Dayton, OH - Dayton, OH
CRS

Retail flipping in art. You don't have to spend fortune. Just do things that matter. See what items are in fairly decent shape, and those that needs replaced. Paint and carpet are two basic updates buyers look for

Sep 20, 2020 01:46 PM
Michael Jacobs
Pasadena, CA
Pasadena And Southern California 818.516.4393

Hello Mike: smart ideas need not be expensive.  Proper planning and the right execution can make significant differences.

 

Sep 20, 2020 01:53 PM
Anthony Acosta - ALLATLANTAcondos.com
Harry Norman, REALTORS® - Atlanta, GA
Associate Broker

Good afternoon Mike Cooper,

Thank you for sharing your information on how to flip homes on a small budget. Great tips for those first time investors to follow.

Have a great day.

Sep 20, 2020 03:10 PM
Kathy Streib
Cypress, TX
Home Stager/Redesign

Hi Mike- Like your new profile photo. I love the approach you took. Do what you can while keeping your budget in mind. But whatever you do, do it well. 

Sep 20, 2020 05:21 PM
Mike Cooper, Broker VA,WV

Thanks, Kathy. I thought I'd bring out the beauty in the family for the profile. There so many things I did on the flip that I hadn't planned, but as I tore the house apart, I found mistakes previous owners had made that in some cases were dangerous. So, I spent a lot more time than I planned. It also sold before I finished or listed it. The lady who bought it is in her mid-70s. She has a few health limitations. So, I went through and made some access modifications to make it easier for her. That ended up extending the work a bit, but I walked away with a nice profit and a happy heart.

Sep 20, 2020 05:31 PM
James Dray
Fathom Realty - Bentonville, AR

Morning Mike.

I also have ran into that problem, the sellers are not willing to upgrade their home to get the best price.  On the other hand, I've seen investors buy a property, make a few changes and reap the rewards.

Sep 21, 2020 12:36 AM
Patricia Feager, MBA, CRS, GRI,MRP
DFW FINE PROPERTIES - Flower Mound, TX
Selling Homes Changing Lives

Mike Cooper, GRI - I commend  you for going above and beyond to get the right things done to help it sell successfully and still keep it under budget. Not many people can do what you do. The story about finding an HVAC at that price was like finding a treasure!

Sep 22, 2020 10:26 AM
Roy Kelley
Retired - Gaithersburg, MD

Thank you very much, Mike, for sharing your experience.

Take care, be safe and have a very productive month.

Sep 23, 2020 05:39 AM
Lynn B. Friedman CRS Atlanta, GA 404-617-6375
Atlanta Homes ODAT Realty - Love our Great City - Love our Clients! Buckhead - Midtown - Westside - Atlanta, GA
Concierge Service for Our Atlanta Sellers & Buyers

Mike Cooper, GRI
Certainly a firs class result - even extra special features for one buyer.
All the best - Lynn

Sep 25, 2020 05:57 PM
Kathy Streib
Cypress, TX
Home Stager/Redesign

Sep 26, 2020 06:19 PM
Kristin Johnston - REALTOR®
RE/MAX Platinum - Waukesha, WI
Giving Back With Each Home Sold!

Congrats on  your feature this week from Kathy!  Well deserved!

Sep 27, 2020 07:05 AM
Debb Janes
Nature As Neighbors - Camas, WA
Put My Love of Nature At Work for You

We just met with sellers ( a family of four siblings) who all thought their late parents property had to be worth, at least a million dollars. Hopefully a million - five. Nope, the 80's style chopped up floor plan, dark cabinets, filthy carpets, low ceilings, and a maze of aging decks on the back of the house is going to be an albatross for buyers. The 24 acres, most of which you can't use, is not going to be that desirable.  The bathrooms are also carpeted...??? The floor plan is so unappealing, I'm not too sure what they can do that would be cost effective.  At any rate, they ended up going with a Windermere agent because of a family connection. In some ways, I feel sorry for him. It will be interesting to see how he markets it. The good news, he and I came up with the same value around $900 thousand. 

Sep 27, 2020 08:19 AM
Mike Cooper, Broker VA,WV

Sounds like you dodged a bullet, Debb.

Sep 27, 2020 02:09 PM
Grant Schneider
Performance Development Strategies - Armonk, NY
Your Coach Helping You Create Successful Outcomes

Hi Mike Cooper, GRI - a few small replairs make a very big difference.

Sep 27, 2020 11:05 AM
Kat Palmiotti
eXp Commercial, Referral Divison - Kalispell, MT
Helping your Montana dreams take root

Excellent! $1000 and your elbow grease totally transformed that home! 

By the way, I listed a mobile home for sellers once and they had used that product on the counters. It really looked quite nice.

And by the way part two, I've volunteered my time at a Habitat Restore and they have LOTS of inexpensive new items - it's a great place to get deals.

Sep 27, 2020 11:27 AM
Kris Collis, Associate Broker
Smart Way America Realty - East Stroudsburg, PA
Professional Results you Expect 570-801-5525

Mike, how to be the go-to realtor on flips. 

Perfect selection of improvements to update and transform the appearance without breaking the budget.  Great ideas, loved the synchronicity of answers falling into place as you needed them.

Sep 27, 2020 11:46 AM
Rocky Dickerson
Realty One Group - Las Vegas, NV
Superior Service!

Great ideas on cost affective ways to improve the flip.  Great bang for your buck!

Sep 27, 2020 01:38 PM
Lyn Sims
Schaumburg, IL
Real Estate Broker Retired

There is no way a buyer would buy those cabinets in our market. They are the kiss of death in a kitchen. Hear it over & over again.

Sep 28, 2020 09:54 AM
Mike Cooper, Broker VA,WV

Oh, they are sad. That was my dilemma. I had to find some way to take focus off the cabinets. 

Sep 28, 2020 04:20 PM
Jill Sackler
Charles Rutenberg Realty Inc. 516-575-7500 - Long Beach, NY
LI South Shore Real Estate - Broker Associate

I love the way you describe the kitchen as "not sexy." You're obviously in touch with what consumers will love.

Sep 29, 2020 03:09 PM
Jeff Dowler, CRS
eXp Realty of California, Inc. - Carlsbad, CA
The Southern California Relocation Dude

Hi Mike:

You did a great job, and put ssome careful thought into what you were doing and for how much. Many who flip do not do so, and the low budget flip LOOKS look budget!

Jeff

Oct 01, 2020 04:40 PM