Choosing A House To Fix and Flip: Make sure to take a good look at the kitchen and bathroom.
When evaluating properties for potential investment and flipping, a major consideration is the cost of renovation. In many houses, the two areas most likely to need upgrading — the kitchen and bathroom — can also be the two most expensive areas to remodel. Improvements to a kitchen or bathroom requires input from nearly every major trade, including plumbing, electrical, carpentry, drywall, tile, etc. This can easily take a huge bite out of your profit, so it’s always a good idea to formulate a plan for these two rooms. How thorough do you want to be, and how much can you afford to redo? The key is to take a careful assessment of the work and prioritize to minimize surprises and prevent going seriously over-budget.
Avoid Kitchen Nightmares
Nearly every older home has suffered some years of exposure to problems like leaking drains and damage from accidental overflows.
How are the floors? When you’re checking out a property, be sure to inspect the floors, and I don’t mean the tile surfaces. Water can do an incredible amount of damage in a very short time. If the sub-floor is soft, or if there is a bounce or noticeable dip around the sink area, make sure you know why.
Are the cabinets usable? Even If you install them yourself, new builder-grade cabinets and countertops can easily run from $2,500 – $6,000. Unless your project can justify this expense, try to get away with just paint and a change of hardware.
Evaluate Bathrooms
Looking over a bathroom can reveal a variety of problems. Seeping toilets, and leaky shower curtains and doors, to name a couple, can cause damage that must be addressed.
Again, how are the floors? I have seen dozens of bathroom floors consisting of only the ceramic tile, or multiple layers of linoleum, where the leakage from the tub or toilet had completely destroyed the sub-floor. As a result, with the joists nearly gone, tubs would be balancing precariously on very small sections of unattached framework.
To a skilled contractor, these issues are not a huge deal. But if they were unexpected, and not counted in your cost of repair, it could be quite harmful to the bottom line. It’s best to take a little extra time and give a little extra attention to the state of these areas when choosing a home to renovate. It’ll help ensure a smooth and profitable project.
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Bob Kmosko has been a full time contractor /re-habber/ investor for over 25 years.
His company, TK Homes, is focused on providing discounted wholesale properties to contractors and investors. If you are currently in the market for a wholesale property, or are considering purchasing one the in the future, log on to TKHomes.net and let us know what you need!
