Flipping Houses: Instant Equity

So, you’re taking on flipping a house. Good for you, taking on a project that others weren’t willing to and seeing the potential that nobody else was willing to see in a property. Beyond replacing backsplashes and appliances what do you do? You’ve found yourself the right property. Good location, right price, but you bought a fixer-upper and it’s time to get to work. Where do you start?

You need to start with some instant equity projects. These projects always add good resale value to the property (and cost money and require professional help) and are totally worth the price.

Start on the outside and work your way in. Curb appeal always bumps the value of the property. First important instant equity project is:

A New roof - This improves the house on the inside and the outside, nobody wants to buy a house that has a roof that’s already leaky when they get there. An old worn down roof is also a visible eyesore, pealing, curling shingles, not cute and not comforting. This project will cost you around 7,500$ and the return should be approximately 109% or around 8,150$.

Replace the Siding - Here me out, vinyl sidings. They are more durable than they used to be and it’ll never have to be painted again. A new, fresh looking siding on a house instantly bumps the curb appeal adding instant value. This will cost around 13,000$ and will get you back around 10,000$. This is about a 75% return.

Hardwood Flooring -  There is nothing more coveted, more classic, as easy to clean as hardwood floors.  If you pull up the old crusty carpet and find a hardwood floor you’ve struck gold. It’s worth installing even if it wasn’t already there. Hardwood floors add instant value and are a highly sought-after feature. The return is pretty good too. Around 100% return rate to refinish and around 90% to install. 

If you get a good deal on the property and are able to make updates with good returns and stay inside your budget, you should get a good profit from this project. If you’ve done your research on the neighborhood, know what houses in the neighborhood are going for, the features on those homes compared to the one you’re updating. Determine your budget based on the market value of homes in the neighborhood. Spend under that number and sell as close to it as you can, a little higher if at all possible. That’s the art of flipping. Find a deal on the property, renovate under expect to sell for, put the house back out there, make a profit.