Every flip comes down to the same balance. You need to improve the house enough that buyers want it, and you need to do it cheaply enough that there’s still a profit at the end. Whether you’re new to fix and flip or have a few sales behind you, where you spend the renovation budget is one of the most important decisions you’ll make.
Here’s how to choose renovations that pay for themselves.
Start with your local market
Before you look at any list of popular upgrades, look at what has sold recently near your property. Pull the last several sales, compare the listings, and note what the homes had in common. That tells you what buyers in this particular area expect.
It also tells you what to skip. A bonus room or a new patio is nice to have, but it rarely moves a buyer the way an updated kitchen or bathroom does. Put the money where local buyers have already shown they’ll pay for it.
Kitchens and bathrooms
These two rooms are where buyers look hardest for value, in almost every market. A kitchen with new countertops, good flooring and modern appliances makes the whole house easier to sell. The same is true of bathrooms. Nobody is hoping to find a bright yellow bathroom from the 1960s with tulip wallpaper.
You don’t always need to tear everything out. Sometimes new surfaces, fixtures and lighting are enough. Match the level of finish to the price range of the neighborhood.
Go clean and modern, not trendy
A trendy look appeals to some buyers and puts off others. Even a style that’s popular right now, like farmhouse, narrows the group of people who will want the house.
Neutral paint, open sightlines and simple staging appeal to nearly everyone. The buyer should be able to picture their own furniture in the room. You’re selling the house to someone else, so their imagination matters more than your style.
A simple test for every upgrade
Before you approve any piece of work, ask two questions. Will it raise the sale price by more than it costs? Will it help the house sell sooner? If the answer to both is no, leave it out.
We list three more high-return projects in top 3 home renovations for resale.
Thinking about your first flip, or your next one? See how Sachem Lending’s fix and flip loans work, or start an application.
