Fix & Flip
List of Potential Fixer Uppers / Fix and Flips in Seattle
|Mercer Island||Seatac||Des Moines|
|Federal Way||Burien||See All|
How to Fix and Flip Successfully
After the introduction of reality house flipping, fixer upper shows on television, it seems like everyone wants to fix and flip houses now, but what does it really take to be successful at it?
In the first quarter of 2019, flippers averaged 38.7% ROI or a gross profit of $60,000 per flip
How much you can earn overall as a flipper depends on how well you calculate your projected profit margins, hitting your targeted budgets, and how many houses you flip each year. Experienced flippers who turn over multiple properties every year are able to hit higher ROI rates of 30%-60%.
What to Focus On
- Focus on location first, then cosmetic features, especially kitchens and baths
- Don’t overspend on renovations (and budget for the unexpected)
- Use the 70% Rule of Thumb which states you should pay no more than 70% of the after repair value.
- Account for closing costs when calculating your margins
- Partner with a Real Estate Agent who will negotiate your home purchases and list your homes for sale at a full service, discount.
- Make a list of contractors you trust and can depend on to do the work on time without surprise costs.
What Buyers of Your Flipped House Will Look For
This is almost always the primary factor buyers will consider.
- Distance to work, stores, ease of access
- Neighborhood Charm
- Appearance of neighbors and pets
- Traffic and Safety of the area.
- Access to parks, shopping, schools, and public transportation.
- Look for older housing with out of date cosmetics, appearance and infrastructure.
Most buyers do not want the hassle or cost of these updates if they can avoid it, and fixing them can significantly increase the value of the home.
THE LOT/BUILD SITE
First impressions are everything.
- Does the home have a view?
- Is it on the side of a hill?
- Does it have a steep driveway?
- Yard suitable for pets, gardening or kids.
- Curb Appeal, landscaping.
THE SIZE AND FLOOR PLAN
There is no one size fits all here. Some people want minimum space to take care of, others want as much space as they can find. Know your target buyer before you start a project and do your renovations with them in mind.
Buyers want an updated kitchen that works for them. Appliances can be replaced fairly easily, but other things like counter tops, cabinets and flooring are more difficult and costly. Buyers will pay more for an upgraded kitchen that is already in place.
It is vitally important to make sure the roof does not leak and has at least few years left before it will need to be replaced. Many buyers today also want a home with roof-installed solar panels. However, you should always first check with the local utility companies, as they may prefer their own, cheaper solar installation programs.
HVAC AND ELECTRICAL
Buyers expect functioning HVAC and updated electrical. The time and expense involved in updating and fixing electrical systems can be extensive, so be very wary of a house with electrical issues and budget and plan accordingly.
WINDOWS AND LIGHTING
LET THE LIGHT IN! Make sure the windows allow enough light in the house, are modern and are energy efficient. This will add immense value to your project.
CLOSETS AND STORAGE
Buyers love storage, if there is anything you can do to add storage, such as finishing an attic or a space under the stairs, do it.
BEDROOMS AND BATHROOMS
An extra bedroom is always a plus, as it can be used for a home office or guest room. Bathroom sizes and amenities usually matter a great deal to buyers. A large master bedroom can make a big difference to the marketability of the home.
THE SMALL DETAILS
These are the little things that do not have to cost a lot, but can intensively increase your home value. Installing moldings, modern hardware, a clean fireplace, spotless floors/carpets or freshly painted walls can do wonders to make a home look special.
So, why do some flips fail?
- Overpricing is the number one reason. Consult your Real Estate partner for the right price point to have buyers fighting over your home.
- Poor location
- Listed before it is finished. Don't get in a rush and put your home on the market before it is ready to WOW.
- Poor curb appeal - get landscaping done or do it your self, but do it.
- Cosmetic irritants - Don't be lazy, clean everything and make sure walls and floors are spotless.
- Messy neighbors - just avoid buying homes next them.
If you’ve done a good fix up and the house is completely ready to list, the house will sell fast.
Want to see some potential homes to flip? Call Cara Cusack now 206-257-8210.
- Jonathan Dewitt
- Tina Scott
- Adam Gilbert