Today’s REI Classroom Lesson

Today, Blake Yarborough chats with us about important upgrades to put into your rehab project.

REI Classroom Summary

Blake shares what areas he focuses on that will bring in a high appraisal. He mentions how spends a bit more and goes for granite in most properties since it helps with appraisal and makes it standout for tenants or buyers.

Listen to this REI Classroom Lesson

Real Estate Investing Classroom Show Transcripts:

Mike: Welcome back to the REI Classroom, where experts from across the real estate investing industry teach you quick lessons to take your business to the next level. And now, let’s meet today’s expert host.
Blake: Hello, this is Blake Yarborough with REI Classroom. I’m the host today. And thank you for sitting in with me and we’ll go over a few things that I think are important when talking about important upgrades for flips or appraisals.
Mike: This REI Classroom real estate lesson is sponsored by FlipNerd Investor Coaching, your blueprint to investing success.
Blake: You know, one of the basic things when you’re preparing a house to sell is the curb appeal. How does it look from the street? I think fresh exterior paint is a must. It’s very rare I don’t paint the exterior. At a minimum, you need to pressure wash and get it clean. I’m a big fan on painting the fascia and the trim.
And the other thing is when people walk up to the house, make sure it’s clean. Make sure the doorbell’s . . . I mean, I know I’m being silly, but just make sure these details, when people walk up, that they see every time that the doorbell’s good, the door is nice and clean. Okay? The handles match, there’s not a loose, swinging door in front of it. Also on the curb appeal, nice, clean, manicured bushes and plants.
Now that we go inside the house, you’ve heard it time and time again, kitchens and bathrooms. Okay? Provided that your flooring is nice, clean, and no major flaws and you want to do it on a limited budget, I would put almost all my money . . . except for painting the house, the inside of the house, I would concentrate money in the kitchens and bathrooms. In many kitchens and bathrooms, I can get a galley kitchen or a kitchen with brand new granite. I like to get an under-mount sink installed because that’s one thing that may be different than a lot of the neighbors. And it’s, “Ooh, it’s an upgrade.” And it really doesn’t cost that much more to do. I’m a real big fan of under-mount sinks and nice faucets.
While we’re in the kitchen, I’m a big fan of stainless appliances. But be careful, don’t overspend on these. But when you walk in, you have a beautiful kitchen sink and appliances, it makes an impression. Make a nice little backsplash, tumbled stone or whatever you may choose that blends everything in between the cabinets and the granite. And there are so many choices of granite. Knowing where to get it is important, and depending on where you are, there are granite yards, and you can cut people out of the middleman. And I can get granite installed for not much more than it costs to put in Formica. So please check into it, do your research. It will make a difference.
When we talk about kitchens, almost every house I do, I’ll go ahead, I’ll take this surround out or whatever, and I’ll put new tubs in . . . not new tubs every time, because a lot of times tubs are good. But I’ll put new faucets, but I will put in brand-new tile, like a light beige tile, and I’ll make my little cutout for the soap and shampoo to sit in. But I like to have my tile surround in the bathrooms. It’s a nice look to it, it’s definitely updated. And also, the countertops, it’s not a lot of space. So when you have the granite guy out there, a lot of times, he can use scraps. Or it’s not much more to go ahead and get him to do both bathrooms. So if you have granite in the bathrooms, nice, inexpensive fixture with a nice mirror, and with surround, it usually does well.
So now we’ve addressed the kitchen and the bathrooms. Simply painting. Some people are talked into painting everything the same color, the walls and the ceilings. I personally do not. I like to have nice baseboards, and white baseboards, and white ceiling. And then I’ll do my beige walls. The other little deal, costs a little bit of money, it’s a nuance, but I hate having a clean house with dirty plugs, outlets. So I always put nice, clean plugs and switches. And when you have that, even if it’s an old house, now they’re in a pretty clean house that has new plugs and switches, granite throughout, nice, fresh paint, white baseboards, white ceiling, beige walls, I think you’ve got a winner on your hands.
So this is Blake Yarborough. Get back to the basics. Hopefully, these things help. And one last thing that I meant to say that I should have said earlier, I’m a big fan of installing granite on anything over $100,000. Because as a lender, I see people doing this and putting Formica back down, and then they’re not getting the top-end value. They’re wanting Neiman Marcus value with a Kmart budget. Go ahead and spend the extra $2,000 or whatever it may be. It may mean $2,000 to $5,000 more on appraised value. And if you’re going to rent the house out, it will be more perceived value for your tenants, which will get you more rent, which will pay for the $2,000 or whatever you spent for granite. Signing off, Blake Yarborough, today’s host. Thank you.
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