return on investment Archives - Classic Floor Designs

Flipping houses is hard work, but the return on investment on a flip property can be worth it. Houses that are ideal for flipping often have an outdated style with damaged materials and other cosmetic issues. Because many buyers prefer to purchase a home that is in move-in-ready condition, properties that are ideal for flipping may be undesirable to others. One of the more common ways that house flippers improve décor and value is by installing new flooring in most or all rooms of the home. This is because flooring has a dramatic impact on decor, ambiance and overall appeal. However, choosing the right materials for flooring and for all other improvement property projects will affect your return on investment.

Choosing a Suitable Property

The best time to think about the materials for a renovation project is before you finalize your purchase plans. Flipping is usually most cost-effective when the property only requires superficial or cosmetic enhancements. This includes replacing the flooring, painting the drywall, and tackling other similar projects. More significant efforts, such as replacing the roof, can dramatically increase cost and may reduce your overall return on investment. When you are touring potential homes to buy, you can also search for homes with materials that may be refinished rather than replaced. For example, refinishing a hardwood floor is often more cost-effective than installing a new hardwood floor.

Selecting the Right Materials for a Flip

Some of the most common types of flooring used when flipping a home are hardwood, carpet and tile. Everything from the color and style of the material to its cost and how easy it is to install should be taken into consideration. Because time is money when you are flipping a home, the immediate availability of the material should also receive your full attention. You also need to focus on the the décor of the home as well as the functionality of each room while selecting flooring. For example, installing carpeting in the kitchen or bathrooms may decrease the home’s appeal dramatically, and this could reduce your return on investment.

Optimizing Your Return on Investment on Your Property Flip

When selecting flooring and other materials for the renovation, your goal is to find the materials that offer the greatest financial return. This does not usually mean that you should install the most expensive materials that you can find. Everything from the appeal that a material has to a potential buyer to its ease of maintenance, its cost of installation and its impact on décor should be considered. Your goal is to choose a material that is desired by buyers and that is cost-effective to install.

Installing the Flooring Promptly

Whether you choose carpet, hardwood or other flooring materials, the installation time and cost must be taken into account. If you choose a material that you can install on your own, such as some types of hardwood or tile, you may save a small bundle on the total installation cost. This directly increases your return on investment. On the other hand, if the carpet or other types of flooring must be professionally installed, the total cost of the project increases. As a result, the return on investment decreases.

Finding Quality Materials with Competitive Prices

When you search for quality materials that bring true value to the home, everything from the cost of labor and materials to how coveted those materials are to prospective buyers should be reviewed collectively and comprehensively. Savings opportunities on different types of flooring materials will vary over time. With this in mind, you will need to conduct thorough research on current deals for different flooring types for each new project that you work on.

Installing new flooring in an older home with outdated style is a relatively fast and easy way to improve its ambiance and to erase years from its visible age. However, the right materials for the home as well as for the target buyer must be found, and these materials must be cost-effective to purchase and to install. You can begin exploring some of the wonderful possibilities available today for your next flipping project by browsing through online inventory.

If you’re planning on putting your home on the market soon and want to increase its value, the key is to pick home improvement, remodeling projects that give you the best return on investment. As a rule, aim for projects that earn back at least 90 percent of your investment but preferably 100 percent or more. These are some of the top recommendations for the best ROI.

Kitchen Remodeling

Along with bathrooms, kitchens are the most expensive rooms from a structural perspective. When inspectors come to assess your home’s value, they can tell when money is invested and when cheap fixes are used. For the fairest ROI, don’t spend more than 10 percent of your home’s value on a kitchen remodeling project.

One of the biggest mistakes people make is investing in high-end designer wood cabinets. Tearing out and hanging new cabinets is a costly home improvement project. If your cabinets aren’t severely warped or damaged, you can refinish them and install new hardware. Granite countertops add value to a home. Appliances are also important. Ask a real estate agent about which appliances are better for your area. Some brands may raise a value more than others in a certain area. Some less expensive additions that add value are under-cabinet lights and pull-out pantries. Installing recessed lighting is also a good inexpensive way to add value.

Bathroom Remodeling

When you live in a popular area, like Washington, D.C., a smartly planned bathroom renovation can earn back more than 100 percent of your investment. In today’s fast-paced world, fewer people have time to take baths. Install a glass walk-in shower instead of a prefabricated standard combination unit. Low-flush toilets are also a smart purchase.

Adding a second bathroom may be wise in some cases. If your home has more than two bedrooms and only one bathroom, opt to add an efficient second bathroom instead of renovating the current one. In some cases, it can increase the home’s overall value by five percent or more, which is a better average value than creating an additional bedroom.

Add A Bedroom

In a hot housing market, you may be able to top your investment by adding a bedroom. There are several ways to do this. You can make an attic bedroom or loft. Or, you can put a bedroom in your basement. If your basement and attic need a considerable amount of expensive work such as HVAC and wiring, an addition may only be a cost burden. However, you can turn a finished den or office into a bedroom. The presence of a closet is what distinguishes a regular room from a bedroom. Explore cost-saving options for adding a closet. Bedrooms add more resale value than all-purpose rooms without closets.

Install New Flooring

Although floors collect dirt and germs, they shouldn’t look dingy. If you have old carpeting, cracked tiles, or discolored and warped laminate flooring, upgrading your floor is an excellent investment when it’s time to sell. Hardwood flooring offers the biggest payoff. Check to see if there is existing hardwood flooring exposed or hiding under old carpeting, and consider having the wood refinished and adding a dustless finish to entice more buyers. Stone floors also add value to your home and are a coveted feature among many buyers. If you have a large budget, some exotic flooring options add a considerable amount of value as well.
When you have other areas of the home that need attention and you can’t afford a high-end stone or hardwood floor, consider ceramic tile or engineered hardwood. Both home improvement options are more affordable and add value.

Prioritize Home Improvement

While adding a bathroom or converting a den to a bedroom may be the best investments for some people, others would be better off avoiding such projects to address more serious issues. For buyers and inspectors, updated plumbing, roofing, heating, cooling and wiring are more important than an extra bedroom or a bathroom with a glass shower. If the roof needs to be replaced, make that a priority. Fix any serious problems or structural issues that are lowering your home’s value before you start thinking about remodeling the interior.

The best way to approach a pre-sale renovation is to inspect your home or have it professionally inspected. Make a list of what must be done, such as treating a termite problem or patching a newer but damaged roof. Next, make a list of prioritized home improvement tasks, and decide which ones fit your budget and offers the biggest payout.

Photo Credit: ReBath of the Triangle/Triad/Wilmington Flickr via Compfight cc

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Best Flooring For a Flip Property