10 easy ways to get your home ready to be flipped -- and to ensure a successful outcome!
Though the heady days of the real estate boom are gone for now, real estate continues to be one of the safest investments you can make—that is, if you invest smartly. The key is to know what improvements to make, be realistic about what you can expect to gain, and to have a very clear idea of what is happening in the neighbourhood. Caroline Altman of Lighten The Load, a company that specializes in a range of home staging, decorating and moving services, offers the following tips to would-be real estate tycoons.
Before you even think about flipping a property, compare the home you plan to flip with other homes in the area. If a comparable property sold for $600,000 with a renovated kitchen and new appliances, don’t think you can get the same $600,000 by repainting the kitchen cabinets and laying down new linoleum.
When you scout other properties, note what upgrades have been made. Are the kitchens and baths fully renovated, with granite countertops and stone tile, custom cabinetry and stainless steel appliances, or more modest? Are there brand new hardwood floors throughout? Recessed lighting? A finished basement? Is the electrical and plumbing upgraded?
2 Upgrade landscaping
Remove old or dying trees, bushes and flowers. Trim overgrown areas. Replace dead grass with fresh sod. Plant evergreens, wreaths and potted urns in winter, and colourful blooms in spring and summer. Use wood chips (try chocolate- or cedar-scented versions) or gravel to inexpensively cover large trouble areas.
3 Spruce up the exterior
Paint flaking or dry-rotted windowsills and shutters. Paint the front and back doors as well as the garage doors, or if needed, replace them. Repair or replace broken or non-working eavestroughs. Repair or replace any aging or broken fencing. Finally, consider adding exterior lighting to enhance curb appeal.
4 Renovate the kitchen and bathrooms
These are perennial focal points for buyers, but you must find a balance between being cost-conscious and looking like you took the cheap route. Kitchens can cost between $15,000-$80,000, and bathrooms can run between $6,000-$30,000. Again, check the comparables and see what materials they used. If most of the homes in the neighbourhood feature granite countertops and brand-new appliances, then you should follow suit if you expect a similar price tag.
5 Replace/upgrade flooring
Again, check the comparables in your neighbourhood before you decide on what new flooring you should choose. If all the homes in the area have new hardwood, don’t lay down laminate, unless you want to sell your property at a lesser value.
You can cut costs by choosing synthetic versus natural stone tile, and sanding and re-staining hardwood instead of replacing it. Also, you can save by having your carpet company bind large remnants for bedrooms instead of installing wall-to-wall carpet. This should only be done if the floor is hardwood and in relatively good condition.
Don't just paint the walls; do everything—ceilings, closets, baseboards and interior doors. It will make the property feel brand-new. Remember to choose neutral colours.
7 Change old switch plates
Nothing ages a property more than old, outdated and yellowed switchplates. You can hire an electrician or do it yourself if you have the skills. Dimmer switches in dining rooms, eat-in kitchens and living rooms add an inexpensive and nice touch.
8 Install crown mouldings
Adding crown moulding is a non-structural change that can reinvent any interior. Avoid the cheaper versions from large hardware chains that you can install yourself; they may save you money, but will look cheap. Make sure you choose a crown moulding of significant size that matches the style of the house, and make sure there are no visible seams once installed. Also, if you re-do crown mouldings, consider adding new baseboards as well.
9 Modernize lighting
Pot lights run about $100 and up, making them a high-return investment. Consider adding new chandeliers in the foyer, dining room and kitchen. Check a large hardware chain for knock-off versions of designer fixtures that you can purchase for a fraction of the cost.
10 Upgrade plumbing and electrical
If you can afford it, the cost is well worth it, since the buyer will likely ask for more credit back on the purchase than an electrician and plumber would charge to complete the work beforehand.
Finally, make sure you have a savvy real estate agent on board who knows your specific neighbourhood. Make sure that the changes you make bring your property up to a similar level to the competing properties in your neighbourhood. Also, be aware of fluctuating markets. Don’t assume that a property that sold in your neighbourhood a year ago will yield the exact same price.
Remember the goal to flipping is to make money. Be realistic about profit margins before you begin. You can’t sell a million-dollar home in a moderately priced neighbourhood where homes go for a maximum of $600,000—no matter how much marble you use.