There are two trains of thought when it comes to rehabbing a house, and there are successful real estate investors on both sides.
So, here is the first side. Be creative, use your imagination, be free, try new ideas. “Help the rehab capture a story that the pictures can tell”, Do not be afraid to question what other have done before you.
Here is the other side: Copy, Paste, Copy, Paste. What have others done that has sold and copy it. Do not reinvent the wheel.
Memorize this line “Barely as nice as” the house that just sold.
I asked a long-time flipper, where do you fall, which side do you choose? His response,
“Every home I buy I ask myself this simple question: Do I want to fit in, or do I want to stand out? How can I get the most money possible in the quickest time possible? I look over the house and the neighborhood, Do I want to fit in or stand out. Most of the time I am fitting in, why? Because I have never regretted fitting in with beige/grey walls and a bland but new kitchen. I have regretted the blue kitchen I did once, I did regret the treehouse I built to try and stand out, I did regret the mural I paid a local artist to paint in a family room.”
Fitting in is a bigger market than standing out. And you can always leave room for the new buyer to ‘make it their own’ rather than imposing your view or trying to guess what they want or where the winds and whims of fashion will blow. The buyer can always change something, or add something to make the home pop in their own way.
For example, when a homeowner tours a model home in a new development, they get to choose a, b, or c on the finishes. Those finishes are neutral and allow the builder to re-sale the house if financing falls through. Many buyers choose the lowest/cheapest grade materials in areas where they want something to stand out, because they plan to tear it back out after purchase and put in what they want. But it is not the developer’s job to make their house stand out, his job is to build a quality home, as cheap as possible, that is marketable and sells.
Custom homes take longer, cost more, and most importantly are difficult to scale. It is easy to scale a product that works with the same cabinets, same countertops, same flooring, same paint color, etc…. Its hard for the contractor to mess up when all they are doing is copy and paste!
Article was first posted in the March article of ICOR