It breaks my heart when I meet a first time house flipper that has put blood, sweat, and tears into a project only to find out they have over improved the house and will not be able to get out what they put in. With that in mind, I have a few tips to help steer you home flippers in the right direction so you have a more realistic point of view BEFORE you start!
Always do a preliminary budget before you purchase the home - This is so important because you need to know if the purchase price + the budget will = a nice selling price (meaning profit!!!) for you.
Always determine what you can sell it for when it is complete before you purchase - You need to know if after all the hard work is done you will even be able to get your asking price. I suggest talking with a real estate agent to determine what houses are selling for that are in excellent condition in a particular neighborhood. After you have that figure, plan on listing it for just under market value. The goal here is to get in and get out.
Choose upgrades that are realistic for the neighborhood - Be sure to do your homework before you start the project. You want to know what upgrades are expected in a given neighborhood that will get you a nice return on your dollar. There is no point in putting in a gourmet kitchen for example if all the other homes in the neighborhood have a standard kitchen. You have to stay consistent with what is happening in the neighborhood.
House flipping can be a lucrative career if you do it right. Remember to keep your personal taste and emotion out of the flip. Treat it like a job and nothing else. If you do this, you should have success!!!