View Rehab Renovations that Deliver the Highest ROI

[Joe Assad]

As an investor you have to be thoughtful about how you spend your money on renovations when fixing and flipping a house . Budgets are not endless, and you do not want to risk investing more into a property than it is worth. So, it is important to hone in on projects that will add the most value for the least amount of work and cost. As part of the process, take time to research comparable homes in the neighborhood and see what amenities are common and contributing to high resale value.

Additionally, the changes you make to a property should be about updating the space not about reflecting your personal tastes. A neutral palette will create an environment where a buyer can envision how he/she can put his/her personal stamp on the property. Also, be cognizant of making adjustments that are too trendy and that may not age well. This is often referred to as stylistic depreciation, and it can unknowingly impact your bottom line.

To make sure that you get the most out of your fix and flip renovations, here are the ones that deliver the most value.

Kitchen. The kitchen is a gathering place in the home, making it a major focal point. As a result, homebuyers place a big emphasis on this room when purchasing a new home, which makes it a worthwhile investment when fixing and flipping a property. A kitchen remodel can be a costly endeavor, but cosmetic updates like refinishing surfaces, upgrading to stainless-steel appliances and installing new light fixtures can go a long way with buyers and have minimal impact on your budget.

Bathrooms. When it comes to prioritizing rooms to refresh, the bathroom is a close second to the kitchen. But as with renovations to the kitchen, use your budget on superficial changes versus major modifications to the layout. When making updates to the bathroom, select classic features like off-white tiles and neutral paint that will appeal to a wide-range of tastes. Also, jacuzzi bathtubs that were so popular a few years ago have fallen out of favor with most buyers . So, instead of splurging on big upgrades like that use your renovation budget to replace the fixtures and the toilet, which will provide the highest yield for minimal cost.

Curb Appeal. First impressions are everything, and a potential buyer will form their opinion of a property in a matter of seconds. That said, one of the most important investments you can make is to the exterior of a home . Fortunately, there are many cost-effective ways to improve curb appeal that can have a big payoff. Another way to increase the market price of a home is by cleaning its exterior.

Energy Efficiency. Homebuyers looking for ways to decrease the amount of money being spent on utilities are increasingly prioritizing energy efficiency over luxury features. While many energy efficiency projects take years to recoup the investment, there are some projects that will yield high returns on percent. The cost of replacing windows can be a deterrent for many investors, but it is one of the most worthwhile upgrades you can make. If you are still not convinced, keep in mind that homes with sustainable features also have the added benefit of having lower holding costs.

When fixing and flipping a property, the end goal should always be about making the best looking and most functional property with the least amount of capital expenditure. Contrary to popular belief, big renovations do not always deliver the most value. Often times, minor upgrades that take little labor or financial investment can have the best payoffs. So, with a little research and a little elbow grease, you can get high returns on your next fix and flip project.