Full Gut Rehabs vs Cosmetic Rehabs

[Account Closed]

I've been looking at a few properties in my area, and it seems the deals that only need cosmetic work move quickly, however the full gut rehab deals tend to linger a lot longer and I'm sure are selling for much much less.

My question to the experienced rehabbers is this: Do you prefer what would be considered a full-gut rehab or a cosmetic rehab better?

To me the pros of the full gut would be less competition, DEEPLY discounted prices, and really being able to see everything (you know plumbing or electrical is done right when it's down to the studs, etc).

The cons obviously are rehab costs are much higher, but if the numbers workout, you could probably create more profit spread if you tailor this to your retail buyer demand in your market.

The cosmetic rehabs would obviously be faster to complete the rehab, cheaper, but I would think you'd likely pay more for the property. You also have the unknown element of what things really look like behind those walls.

So which do you prefer? Full Gut or light cosmetic? Maybe right in the middle?

[Aaron McGinnis]

I prefer whichever makes me more money. Hah hah.

That being said, I've done one and only one 'light cosmetic' rehab... and it was the first one I ever did. Everything since then has been a monstrous, full-gut job including a tear-down/rebuild.

I ENJOY the gut rehabs. I like knowing that every little thing is correct. The fact that they require 1000% more effort, time, sweat, tears, and a whole host of crews that have your back is... well, it is what it is.

Also, where I work, there just aren't many light cosmetic rehabs available. All the houses are older than 1960 (more or less)... I really don't think there is such a thing as a 'light cosmetic' rehab on a house that hasn't been updated since it was built 50+ years ago.