What are Rehab Priorities for Live-In Flip

Question

Hey BP, my wife and I are moving to another city here in Texas so we decided to buy something that needed some slight cosmetic work. We found a house in a great neighborhood with great schools, and in great condition. It was built in the '90s and a lot of the house still has the '90s feel, think florescent lighting in the bathrooms and kitchen and brass door knobs, etc.

We want to know what projects makes the most sense since it doesn't look like the ARV will give us much room to play with.

Here are some things to know about the purchase:

• 2,900 sf
• Purchase price $128/sf
• Updated, we fell it will bring $145 pretty easy
• By no means are we thinking we got a screaming deal, just got a house that needs a little updating and it was priced appropriately to reflect that. (Baby-steps right?)

Here is a list of the things we think need to be done, and in the order we are thinking:

• New wood flooring in most of the house (leaving carpet in all bedrooms except master)
• Update master bath
• Paint most rooms
• Update guest bath
• Change glass panes on either side of front door
• Remove florescent lighting in kitchen
• Add patio w/ cover in back
• Change out brass fixtures
• Add shelving and mudroom type bench to laundry room
• Add outdoor kitchen to complete back patio
• Change out white oven and microwave for stainless (the rest of the kitchen has been updated w/ stainless and new counter-tops)
• Other odds and ends

As you may have figured out already, we clearly would like to do more to the house than what our budget will allow if we were to treat this as a flip. I'm waiting on bids from the contractors, but I'm guessing we don't stay with in our range after the first 2-3 items. Have already found our flooring and it is $7.60/sf installed. That doesn't give us much room to play with.

So, that being said, if you have to start cutting items up top, what do you cut, and what do you prioritize?

Howard

Brian Armstrong · Answer

@Howard Mayne

Congrats on finding a house in a great area that needs cosmetic work and tackling the "live-in flip". My wife and I are now in escrow completing our 2nd live in flip. They are not easy and take lots of patience and hard work to finish, especially if you're doing any work yourself.

If you budget is limited, and what budget isn't, I'd recommend trying to do anything you can yourselves. The shelves in the mud room, for example, is something you could do in a weekend and not add it to the contractor's scope. However, the new wood floors and other more complicated tasks that require some experience and lots of tools, I'd hire out. Painting is another good thing you can do to save a few dollars.

As for what you should do, always kitchen and bathroom updates (lighting, hardware, counters, cabinets/vanities, plumbing fixtures, faucets) should be your top priority. Our current place was built in 1965 and it was ORIGINAL!!! We put down new engineered floors (hired out) and painted every single surface (ourselves), but other than that, the only other things we did were update the kitchen and both bathrooms. Those are the keys to selling a house for top dollar with the most buyer interest.

For things I'd defer or not do, the outdoor kitchen is a nice to have in your own place, but it won't appeal to every buyer and you may not see the return on that cost. I'd do the patio (cover if you can afford it) and buy a nice grill that you can keep or sell with the house. Much easier and cheaper.

Best of luck with your project!! The absolute most important thing with a live in flip is don't do some work and get complacent. It's easy to get it "nice enough" and stop, but when it's time to sell, that leaves lots of things to finish up before listing the house.

What are Rehab Priorities for Live-In Flip

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