If you’re visiting our site for the first time, my husband and I, and our little girl are living in a RV and travelling the country after selling everything we own. We are able to do this comfortably because of having made smart decisions with home buying and paying off our mortgages.
We’ve owned two homes in 5 years. The first home we bought from the original owner who priced the house very modestly to sell it quickly. It sat on an acre of land bordered by the land of all the surrounding neighbors. It was a small house in a neighborhood of million dollar giants. It required updating, most of which we did ourselves. Except for the kitchen, which was remodeled on DIY channel’s Kitchen Impossible (Yes, we paid for it, but it was discounted).
We refaced a fireplace, updated two bathrooms ourselves by re-tiling floor, replacing a pink tub, and adding new vanities. We turned the over-sized laundry room, which was really an extra bedroom, into a gym. My husband replaced a balcony himself (with ZERO prior experience with carpentry), we pulled rug and added laminate flooring (hired pros to install). We also had the exterior painted from beige to a grey-blue, and completed various other minor upgrades like lighting fixtures and fans. We sold the house only 3 years later, which is actually not a recommended move as your house may not have enough time to increase in value, but that depends on where you are. We were able to get a solid return on the house because of the work we put into it and increasing its aesthetic appeal.
That wasn’t the only house we successfully “flipped”. We bought our next home two years later–a row home in South Philadelphia. Also purchased from original owners and in need of a complete overhaul. We did much of the updating ourselves using our DIY skills, and hired skilled professionals to scrape wallpaper, pull rugs, lay flooring and paint. We changed the look of our 1980’s kitchen to be a throwback kitchen using the antique appliances that were left behind for storage and simply giving the kitchen a face-lift.
Our Top Five Tips To Successfully Flip A House:
1) Buy a “Grandma House”
Buying from an original owner will most likely mean little has been updated but mostly everything has been lovingly maintained. In that sense, most of your work is more likely to be cosmetic. You don’t want a house with a crumbling foundation, bad electrical systems or failing plumbing. You want a house with old carpet, pink bathrooms and a 1975 kitchen.
2) Live in it
Unless you are independently wealthy to begin with, this simply makes sense from a financial standpoint to start. You have one mortgage, you can take your time, and depending on the laws in your state, you will probably need to wait a full two years after the purchase of the home to sell it again without incurring capital gains tax. Check your state laws. Aside from that, living in it will show you everything about the house you may overlook if you’re renovating from afar. Also, you’ll feel more connected to the process because it will be “your home” for that time. The two houses that we flipped were never really intended to be investments. They were houses we intended to stay in, so we updated it accordingly and with our best efforts.
3) Concentrate most on the kitchen and bathrooms
These rooms are what sell houses. However much money you have to sink into improvements about 70% should go towards kitchen and bathroom improvements. Assuming they’re required. Our Kitchen Impossible reno really was a required overhaul. We got a
$40k kitchen remodel for about $25k because of that show. We didn’t get EXACTLY what we wanted, but that kitchen was amazing, and was the main reason our house sold within 2 weeks listing For Sale By Owner. Our second home was old too, but the original wood cabinets were in great shape and shined up with a new coat of pain and new hardware. We left the backsplash tile and simply painted over it, and the laminate countertops were overlaid with a copper sheet, sprayed with a patina solution, and coated in epoxy. We put the bulk of our money into brand new appliances which were all necessary.
As for bathrooms, do your best to leave the tub alone. If it’s a bizarro color, hire someone to paint it properly (DO NOT do this yourself unless you’re experienced at it….we tried to and had to hire someone to fix it). As long as it’s in good shape, leave it there or cover it. Same thing with the toilet. If it ain’t broke, don’t fix it. But the floors and the vanity will have to be upgraded. Tiling a floor yourself is easy enough for a DIYer, and there are lots of great vanity projects out there that won’t cost a lot. Our upcycled Singer Sewing machine vanity cost about $760 (the trough sink was $500) in materials, but this unique look would fetch about $2k if you wanted to order it on Etsy. (Bravo to us!)
4) Know when you need to hire a professional
Unless you are a contractor already and know everything about everything, don’t be cocky and try to take everything on that you’ve never done before. You’ll end up messing something up along the way and hiring someone to do it anyway, compounding the costs. And even if you think you do have the skill level to do it all, know when it might over tax you. There is a great deal of physical labor involved in renovating a house and if you have a full-time job, laying floor in an entire house may be worth the $2k it costs to have it installed.
5) Know your market!
Don’t invest more money into your renovation than the market will give back.
If you buy a grandma house from an original owner for, say, $150k in a market where the median house price is $175k, don’t sink in $50k in renovations expecting to get a return in only 2 years. You should be purchasing in a market that is growing, not stagnant, if your intent is to make money back on your house purchase. That means you should really know a little bit about real estate and a LOT about the specific market you’re buying into.
Good luck and let us know if you’ve got any other tips for flipping a house on your DIY dime!