A few years ago, it was common in many markets for real estate investors to buy houses, update or repair them to bring them current to buyer's tastes, and sell at a profit a few months later. For most markets, those days are gone. The problem with flips (and flippers) is that they were primarily in the get-rich-quick game-which may work for a while, but doesn't last forever. You can still make money by applying some of the principles touted on HGTV, TLC, and the like, but it's a slower path to your payday. I call this strategy a "slow flip". In earlier articles, I covered the concept and finding the right house.
Each house is different and has different needs, but the basic approach is to get something that can be improved to your personal tastes, but still be suitable for the neighborhood (or you'll have to wait decades to get your money back and by then your choices will be dated).
We've all heard that kitchens and master baths are the two areas you'll more consistently recoup your money. Here are some ideas for hose rooms and a few other places:
- Kitchen - quality AND quantity of cabinetry and counter space. Old pressboard cabinets could be replaced. Quality wood cabinetry might be sanded and stained or painted. Countertops should be appropriate for the neighborhood (starter homes don't need granite unless it's expected in that neighborhood - your Realtor® can advise you on this.) If you are replacing cabinets and countertops, consider a redesign - older homes may not have had as much space as what buyer's expect today. Be sure you've got enough electrical outlets and that they are GFCI protected, add a built in microwave range hood, ensure the cabinets allow for today's taller and wider refrigerators. Replace florescent lights with recessed lighting and add under-cabinet lights for prep areas on countertops. Be sure the refrigerator has a water line. Ceramic tile floors complete the room.
- Master Bath - consider heated ceramic tile floors unless the floors are already in top notch shape. Larger bath rooms are more likely to accommodate dual sinks and consider adult height countertops for the bath vanity. If you're doing any plumbing work in the shower, would a rain can coming out of the ceiling be an option? (It's a real selling point for tall people.) Update the light fixtures to something current looking.
- Whole House Flooring - Hardwood might need to be sanded and refinished, carpet might need to be removed (and in homes of a certain age, there may be hardwood beneath the carpet). Vinyl might be replaced with tile, decks and cement can be power-washed, sealed, and if appropriate (such as garage floors) an epoxy overlayment.
- Rooms and Doors - consider updating old hollow core cheap doors with panel doors, look to see if adding a doorway could change the use of a room (for instance, a hall bath that is adjacent to a bedroom could become a second master if there is room to add a door connecting the two - even if it means relocating a closet in the bedroom so the door has a place to go.)
- Other Things - skylights add natural light, old rickety sliding glass doors can be replaced with energy efficient French doors. A portico at the front door might be a welcome addition when you get home on rainy days.
- Yard - a hedge provides a natural barrier, extra privacy, and it's green. Check to see what plants grow well in your area and try to stick to those that are indigenous as they will be easier to grow. Planning your landscape and getting the changes in during year one will make you much happier in year three when your plans have all filled in. If installing an inground sprinkler system is appropriate for the neighborhood and region, it's best to get that done BEFORE you start making your other landscape updates.
Get general ideas of prices for the things you're most likely going to want to change. That information will be useful in creating your budget, which will be my next post.
For answers to all your residential real estate questions in Hampton Roads,
Contact Drick Ward - Exit Realty Central
757-227-9007
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