Renovation Inspiration (Inspired by Flipping)

Inspired by flipping

Recently, I have been inspired by stories of "flipping" properties. Basically the owners of these properties purchase these properties at a low price and spend some time and money to touch up the place. New stuff, as always, excites the senses. Old fittings and peeling paint, on the other hand, rarely inspires excitement. Most prospective tenants and/or buyers would like to see a property in a tenantable condition, without much effort/money needed on their part to make the place pretty.

If you've never tried flipping a house, but you want to, there's really nothing stopping you from doing it. Except, of course, if you don't have the money to plonk down on a house. In which case, you can flip other things, like pillows and pancakes. If you are agile you can also flip yourself.

How I Define Flipping

I'm too lazy to look up the definition of "flipping a home", so here's my own take on it. "Flipping" means "purchasing a property, whether residential, or otherwise, and improving it, and subsequently selling it off for a profit." 

(And now you can quote me for my definition. You're especially welcome if you're a property guru and you need to quote someone.)

Inspiration for the Uninitiated

So, what's a guy to do? Get inspired, no less. Inspired by what other people have done up with their own properties, and learn a little bit here... a little bit there. These next few resources, so far, have proven to be interesting reading material (but not necessarily relevant).

1. Kathy Price dotcom - Personal website of journalist/writer who is quite knowledgeable about remodelling / renovation.
2. Kathy Price Remodeling Blog - Blog of the above author.
3. Pardon Our Dust - Former blog of the above author.
4. Apartment Therapy - Quite a famous blog covering home improvement, furniture, interior design, et cetera.
5. 247 Reno - This site came up on the Google query, "renovation blog". Does it deserve this spot? Read it and find out.
6. Move Smartly - Real estate blog, based in Toronto. No real focus on renovation, but focuses more on real estate.
7. Design Sponge Online - A blog somewhat similar to Apartment Therapy (see above).
8. Pure Contemporary - Again, somewhat similar to Apartment Therapy.
9. TreeHugger - General (not renovation) blog, with a focus on eco-friendly products/launches, etc.
10. Moco Loco - Great blog, lots of new furniture, etc. showcased.
11. Charlie Collins - Blog covering renovation works on a second-hand house until completion.
12. Design Spotter - Blog about latest design, etc.

If you've ever had a dream, you must try to make it happen. But only for the good dreams, and never the nightmares. Never stop dreaming, and learn to dream only the good dreams. And once you've got that down, make your dreams come true. Never the nightmares. Only the good ones. Keep dreaming!

How to get started in Home Flipping

Step one: Walk to a house, hold the gate, and yank the house out of its foundations. Flip it over as you would a pancake. 

Just kidding!

Step one, for real now: Start getting a feel for the price of property around your neighbourhood. Check the classifieds. Call the numbers that real estate agents put outside properties. Ask your neighbours. 

Step two: Identify the average price of an affordable residential property around your area. (Why your area? Because in the future, you'd know with minimal effort whether someone else living in the neighbourhood would be interested to buy the property). Make it a price vs. built-up area estimation.

Step three: Identify a property that is priced below the average price. You'd know by your homework from step one what properties are on the market.

Step four: Negotiate for a good price. Pay cash if that's what the owner is asking for, but make sure your lawyer has you covered. In a down market, owners may need cash quick. Don't ask them why, just make sure that they have a good title. If it's willing buyer and willing seller, don't ask why. Just buy.

Step five: Touch up the house. At the very least, clean it up and give it a new coat of paint. Fix broken doors, and touch up the toilet as well. Fix broken and stuck windows. 

Step six: Try to get a tenant as soon as possible. When you have a tenant, you start getting returns on your investment. It might even become an attractive investment for a rich investor like Trump. Some people want to buy properties where their investment gives immediate returns e.g. in rent.

Step seven: After a few months, sell it at market rate. If you've added in some great stuff like sofa, TV, kitchen island, and microwave oven, add that into the equation and jack the price up a bit. Make money.

Note

You might be interested to read about how I think lawyers are quite similar to contractors, in more ways than one. Lawyers happen to deal with a lot of real estate transactions, and from time to time, we deal with contractors, too. And so the idea for a comparison or an analogy of sorts was born.