Today’s REI Classroom Lesson
When planning out a rehab, Holly McKhann stresses how important it is to know what people are wanting in that area!
REI Classroom Summary
While most rehabs lean towards being more neutral, some neighborhoods have a different feel and this should be considered when selecting the design features.
Listen to this REI Classroom Lesson
Real Estate Investing Classroom Show Transcripts:
Mike:Welcome back to the Flipnerd.com 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.
Holly:Hey guys, it’s Holly McKhann from houseflipmasters.com, your REI Classroom host of the day. I’m going to share to you today the importance of knowing the comps and your neighborhood and the competition when you’re doing a house flip.
Mike:This show is sponsored by passiverental.com.
Holly:I am reminded of this all the time, even just this week. I want to tell you what happened to me just this week. I have a flip going in Los Angeles and it’s been on the market for a month, and I’ve had no offers. I’m just thinking, “Why do I have no offers?” I think my house looks so beautiful.
I did white and gray shaker cabinets. I did white countertops and this cool stainless steel subway tile backsplash. There’s no colors that are making it too much of a non-neutral house. It’s all grays and whites and silvers, and I think, “Oh, this should just appeal to anyone.” Anyone can come in here and paint whatever color they want. I’ve got a few colors in my accents. The house is staged. It just looks awesome.
I had a friend who has houses in the area and knows the competition on the phone with me yesterday who said, “Well, this other one sold really fast and for more money.” It’s definitely more of that funky look that this area likes. This area’s called Highland Park in L.A. and there’s a lot of flips going on, lots of . . . Like, this house of mine is 102 years old. People are taking the old houses and making them nice and new.
He was telling me people really like the artsy funky look. So, I think in hindsight that mine was too neutral. The one he said that sold fast had green cabinets and butcher block countertops. I’m going, “Oh, yuck, like I would not like that look.” That’s definitely not what’s hot in my area. I live an hour south of there in Orange County and you would not see that look here and it would not go over. But, once again I’m reminded it’s not what I like, it’s what the buyers like. I’m still hoping I’m going to find someone that is more open minded to a more neutral palate, and I should be okay.
It’s so important to really look at your competition. I will say I did look at the comps and found a lot of gray shaker cabinets which are kind of a newer trend, trending away from the white. I did take that into consideration. I’ve got gray on the bottom and white on the top, so I’m doing the two tone thing. I thought, “Oh, I just have it dialed in,” but I guess I didn’t quite go funky enough.
It’s important not only to look at kitchens, but look at your bathroom design. Look at the comps. Look how fast they sold. If you can, talk to other realtors. Or, if you have a realtor that’s going to sell it, find out from them what do they hear from buyers that they really like and what’s important to them in the design of a house. I do that in my open houses, too. When I’m sitting at the house, like, “Oh, tell me what you like and what you don’t like about the house.” Sometimes I tell them I’m the owner, sometimes I don’t, but I always tell them to give me the honest feedback. It’s not going to hurt my feelings. Just tell me.
Sometimes I’ll say, “Oh, I’m not the designer, let me know what do you guys think?” It’s great to hear right from the people that are living in the area or looking to move into the area what they want. Pay very close attention to that and you will stay ahead of your competition and make more money. Until next time, I’ll see you next time on REI Classroom.
Mike:Passiverental.com is your source for turnkey, done for you rental properties. If you’d like to be an investor and not a landlord, please visit passiverental.com to learn how to purchase cash flowing professionally managed rental properties in the hottest rental markets across the country. We can also help connect you with financing for your next property. Invest the easy way today and get started by visiting passiverental.com.
Please note the views and opinions expressed by the individuals in this program do not necessarily reflect those of Flipnerd.com or any of its partners, advertisers or affiliates. Please consult professionals before making any investment or tax decisions, as real estate investing can be risky.
Are you a member yet of Flipnerd.com, the hottest real estate investing social community online? If not, you can join for free in less than 30 seconds and get access to hundreds of off market deals, vendors in your market to help you in your business, and you can start networking with thousands of other investors just like you. Get your free account now at Flipnerd.com.
Please check out the FlipNerd family of real estate investing shows where you can access hundreds of expert interviews, quick tips and lessons from leaders across the real estate investing industry. They’re available at flipnerd.com/shows, or simply search for FlipNerd in the iTunes store.