For real estate investors, choosing where to spend extra money to get extra return on a home is a difficult decision. No one wants to splurge on a nice upgrade to find out later that it added no value. Or even worse, potential buyers or renters passed on your home because they didn’t like the upgrades. Keep in mind that some upgrades, like traditional solid hardwood flooring, will increase the appraised value of your home, which will help buyers with get the financing that they may need. Having worked with contractors, builders, flippers and spec builders for more than 30 years, I think I can share some insight that you may find useful in choosing top flooring options for boosting resale value.
Probably the most common mistake we see is an investor approaching his or her investment property as the home that they will be living in. Applying their non-existent yet imagined decorating and design skills can result in the use of colors that would make 90% of prospective customers turn their head in shock. This is a bad idea! Not only might you lose a home sale but you could also lower the resale value.
Decorating and furnishing an investment property should focus on a few main points:
Leave Some Decorating To The New Owners
Doesn’t everyone like to customize their new home? Unfortunately there are not many opportunities to change the decor in a new home. Repainting is a possibility, but that can be a big expense. The addition of furniture, art, and window treatments can have a big effect on the overall look, but these additions to the decor can be handcuffed by the wrong colors or tones being used for paint or floorcoverings during construction. While that dark gray LVP seemed like a good idea at the time, that prospective customer might hate contemporary decor. Off they go!
Don’t Make A Fashion (or Decor) Statement
So your favorite color is mauve. Who cares? This isn’t about you.
If you love shades of pink in a home, put it in yours. Odd colors seldom have a place in an investment property. While that color may have been perfect for your twin girls as they grew up, a new buyer may have twin boys. Who knows?
Neutrals Tones Are Your Friends
I realize that beige is boring. However, beige also makes a great clean canvas to work with. Neutral-toned decor lets a prospective buyer or renter use their imagination. And fulfilling a dream is how we sell houses!
Anyone can use fabrics, art and drapes or blinds to achieve the look that they want for their space, so be sure to let them.
How Much Money To Spend On Flooring?
Not much! I always tell our investor customers the same thing: the money you save is money that you get to keep in your pocket.
And that doesn’t mean that I think you should buy cheap stuff for your home. Instead you should be more diligent in finding quality products that offer big value. Like, uh, our American Hickory product line at ReallyCheapFloors.com. Do you know that you can buy a first quality solid Hickory hardwood plank made by Bruce for only $2.99 sq ft?
(American Hickory pics)
Search online and you will see that everyone else charges double that. How can we do that? We sell flooring based on supply and demand. When a manufacturer gets too much inventory in a certain product they call us. We do what it takes to fix the problem.
Another great opportunity for investors are our Somerset returns or Bruce downgrades. Most of the time these lots are regraded due to a missed specification. Maybe a floor was supposed to be 50% gloss and it came off the manufacturing line at 30% gloss. Because it isn’t perfect it gets downgraded. That material comes to us and we liquidate it for less than half price. Talk about a perfect floor for an investor! That allows you to install a high-end product while saving huge money. Money that stays in your pocket!
Luxury Vinyl Plank or Genuine Wood Flooring?
This can be a tough decision. As you choose the different finishes and furnishings to be used in your investment you absolutely have to choose your target customer. If the home that you are flipping is 30 years old and in an area that attracts lower income families you probably will not install granite countertops, recessed lighting, and wide plank handscraped Hickory flooring. In this application, not only will you be targeting a lower price point, but you should also take what that customer wants into your plans. Maybe that customer doesn’t want to spend much on maintenance. If that is the case, waterproof options like luxury vinyl plank or the new laminate flooring might be the better choice than genuine wood flooring, as vinyl offers protection against moisture and abuse. At any given time we offer click vinyl planks from different manufacturers in the USA for under $2 a sq ft.
These overstocks will feature at least a 12 mil wear layer, possibly a 20, and offer better value for your home than you can get in any box store. And by now you know where the money that you save goes!
Choosing Flooring Options To Fit The Home
Sometimes the flooring that you use is dictated by the type of home you are building or rehabbing. A rustic-themed home may need wide plank flooring.
When you need a wide plank floor you might select some of our engineered Blue Label offerings from Somerset Hardwood Floors. These ½” thick engineered hardwood floors allow you to use widths up to 6” while not worrying about the cupping and twisting that is so common in solid wood flooring in a home with excessive moisture. Our Blue Label flooring is defined by their shorter average board length, as well as slight natural and manufacturing defects.
Another popular choice of hardwood flooring in flip and rental homes is our Cabin grade solid hardwood flooring. Our Cabin grade floors are offered in Red Oak, White Oak, and Hickory, and are made by industry leaders such as Mullican, Bruce, or Hartco. Available in a myriad of stains and widths, our Cabin grade solid flooring can be used in any nail-down application where excessive moisture is not an issue.
Porcelain Tiles In The Kitchen?
Sometimes an investor will struggle with where to use different floorcoverings. Should the bedrooms be carpet? Porcelain tiles or sheet vinyl in a bathroom? Tile flooring looks nice but can get expensive really quickly, especially if you have to pay for installation. Most homeowners prefer continuity in areas that are not separated by doors, so the same flooring option should be used in great rooms, hallways, and alcoves. Occasionally someone will want to put ceramic or porcelain tile in a kitchen to make it more attractive, but this should only be done if there is a definitive line showing where the kitchen ends and the living room begins. People love great rooms because they make the area look bigger, but a transition in floorcovering is as effective as a wall for dividing a room. Kitchens are the main focus for many home buyers so we cannot afford to make a mistake here. For this reason we recommend using the same hard surface flooring throughout a great room, whether it is vinyl plank or hardwood floors.
What About Carpet?
As far as putting carpet in the bedrooms, that is a tough question. From a financial perspective, if you can install your own hardwood or LVP flooring, hard surface is probably a better idea, as carpet installation has gotten very expensive in the last decade. You can expect to spend prices around $5 sq ft to purchase carpet and padding, and to have it installed. If you are buying hardwood or LVP from ReallyCheapFloors.com for under $2 a sq ft you will save at least 60%. And guess where the money that you save will wind up!
Let Us Help You Make Money On Your Home Sale
I realize that there are a lot of questions that need to be answered, and choices that need to be made. That is why our salespeople at ReallyCheapFloors.com are such a huge part of our success. Having professionals that know how to help you with decisions from decor to installation is an advantage that you need as you navigate this investment. You are doing a lot of work on this investment. Making the right decisions will increase the home resale price, as well as move the home a little quicker so you can move on to the next one.
If you have questions, or would like to receive some samples, please do not hesitate to give us a call.
