Flooring Your Houseflip: Carpet, Vinyl, Hardwood, Tile?on October 24, 2017 8:46 pm under Real Estate Investment Tips, Guest Post
By now, we have all seen the HGTV and A&E shows that make house flipping look easy with just a pinch of perfectly timed catastrophe to give the episode some entertaining drama. Typically, the problem is solved by the creativity and resourcefulness of some very telegenic cast members. This is a great formula for a time waster on a lazy Sunday afternoon, but it has little to do with reality. Watching these shows has given lots of Americans a false sense that flipping a house for profit is something you just dive into and sort the problems out as you find them; this could not be further from the truth!
It is extremely important to attempt to plan and investigate as much as possible before you ever purchase a property. In some cases, like auctions, you may not be able to see much beneath the surface before bidding. In a typical real estate purchase, you can get inspections and look at documents that will tell you a lot of valuable information that should impact your decision to invest. Still, even then, you will only really know the whole truth when the home is bought, walls are opened, and ground is dug up.
Because there is still an element of mystery even after doing due diligence, you will need to also have a good budget with head room for unforeseen repairs and the ability to control costs of material and labor. Today, we will discuss that very valuable ability to control the costs of the materials needed for the flip. You must choose materials that make sense for the kind of market you are selling the home in, and you must not alter too much of the plan once it has been set in motion or you may end up with material that cannot be returned or other costly mistakes. All that goes into renovating a home could make for countless blog posts. So, today we will focus on the flooring materials you may need to purchase if the homes existing floors need to go.
Where to Begin
The moment a prospective home buyer enters a home for the first time, they are probably headed straight to the kitchen. This is usually the most important room in the home for most of the foot traffic you bring in. The second most important is the bathroom. Reserve a significant portion of your home flooring renovation budget for these rooms. This is where you get your most bang for your buck. This is also where water is expected to be spilled, so the flooring must both hold up to the water and not be excessively slippery when wet. Tile is a great choice but if you really need to save the money, you must look hard to find the very best laminate floor. If installed properly, some laminate floors can survive moderate water spillage if cleaned up within a reasonable period of time.
The entire flooring concept of the house matters. A home with the same flooring throughout most, if not all, of the house will need a material that looks good since you will be seeing a lot of it just about everywhere you look. You are probably safer going with a cheaper carpet than a vinyl for the entire house. With an affordable carpet in the living spaces, you can spend some money on the best vinyl possible and use that in the kitchen and bathrooms. Make sure the vinyl is darker in color. It will hide the scuffs that happen as contractors work.
Hardwood flooring is the most coveted flooring material in American homes. From coast to coast, wood floors remain desired by home owners at all price levels. Buying hardwood flooring, whether it be solid wood or manufactured wood planks, is a great idea much of the time. However, this can be quite expensive. While potential home buyers at all levels may love wood floors, not all levels of the market will support the increased cost. You must know the price that will sell the house in that market. You must also do your absolute best to keep your investments under that price. While hardwood floors are loved by most, a starter home may not be the best place to lay them.
It is also important to choose the right kind of wood for the climate. If the home is in a more humid part of the country, engineered hardwood is the smartest choice. This will reduce the shrinkage and expansion common to wood floors as the moisture circulates in and out of it.
If you play your cards right, you can expect to at the very least get back every dollar you spend on wood floors. It is more likely that you get back closer to 1.5 times the wood flooring cost. The right home in the right market at the right time might even reward your investment with ROI at 2 or more times the cost to you.
The best-case scenario an existing wood floor that is damaged and ugly enough to lower the price of the house, but sturdy enough to be brought back to life with a little bit of TLC from you! This will save you a ton of money if you can find a property fitting that description. Having the original hardwood floors restored will make them like new again. The sanding process can remove some minor defects completely. Once a new finish is applied, you will have a beautiful floor.
Carpeting is always a cost-effective way to give the floors of a home a pick-me-up. There is a carpet for all levels of the residential real estate market. It is usually a good idea to replace the carpet for your house flip since there is only so much a good cleaning can do. Uneven wear and tear will make some rooms look acceptable and others will ruin the appearance of a space and make the prospective home buyer forget all the other good things about the property. No matter the grade of carpet you pick, make sure it is the blandest color available, preferably a beige. Its not that beige looks better, but it is so boring that it won’t raise any objections in the market. Most people can imagine themselves in the home when the choices are not too bold. That goes for flooring and just about everything else.
With carpet, you can go cheap and have it look reasonably good. Just not so cheap that you run off buyers. Softer, more luxurious carpets can be had for decent prices if you are renovating a medium tier home or better. The ROI isnt as amazing as wood floors but smart carpet shopping wont break the bank either.
This is truly one of the most affordable kinds of flooring you can get and it can look quite nice. It is usually not a good idea to place vinyl in a high-end home, but entry level to mid-level homes can really benefit from a well-chosen and properly installed vinyl floor.
Laminate peel and stick is some of the cheapest and easiest to install flooring around. For very low-level flips in low traffic areas this can work. Still, this is the most vulnerable flooring to moist environments and imperfect installations. It will deteriorate fast if not done right.
Ceramic tile installation is not as trendy as wood but it is also not as cheap as vinyl. It will cost you a significant amount of money to have a quality tile flooring installation performed. Tile jobs can be priced by the square foot or by the job. For instance, a very small tile half-bathroom might be priced as a job instead of by its square footage so you are just given a standard flat fee. A large kitchen that flows into a dining room, on the other hand, will always be calculated by the size of the area, otherwise known as square feet.
You have a whole host of options when it comes to tile styles, including tile that looks like wood planks but doesnt have the drawbacks that wood can have such as sensitivity to moisture and weather. Tile gives you an opportunity to be very artistic and unique, but be forewarned; custom layouts can drive the cost to be beyond a wood floor, and the highly specific style may not mesh with many home buyers taste.
Flooring Choices to Avoid
Don’t use wide plank hardwood unless it is a very high end home. The cost is so extreme that most homes cant recoup the cost.
Avoid piano finished floors. That level of gloss is not appreciated by everyone. Remember we dont want to make so bold a choice that we alienate more buyers than we attract. Also, multiple showings will mar the shiny finish and require constant upkeep.
How to Buy Flooring Cheaply
First and foremost, buying any kind of flooring at retail is likely to cause you to spend more than you should as a business. You are generally getting the highest prices at the retail store. What you need to do is go to a place that sells remnants of flooring that are still good enough for installation. Not only can you get great prices at these kinds of stores, but sometimes store itself will even offer to do the flooring installation. As convenient as that is, you should always ask if they have two installers they know of that they can offer a reference for. They may complain but it wont hurt to ask. The store wants to get a commission from the install too, and it is your job to save as much money as possible so you need to try your best to deny them this. If the remnant store obliges, give those contractors a call and let them give you estimates. Its that simple!
So, what exactly is remnant flooring? These are pieces of flooring material that may have a slight manufacturing defect, or some damage that was caused in the shipping process at some point. These problems are usually not even noticeable once installed unless you are intentionally looking for them.
Using a Flooring Installer
This is fairly simple, but if this is your first time, it is worth going over:
Let the contractor perform the measurements. It is important that he does this because it will minimize mistakes and if there are mistakes they will be his fault.
Take the measurements he gives you to the store and buy all the needed materials (flooring, padding, finishing pieces, etc.)
Schedule the installation. On a flip, any wasted time is costing you money, so try to efficiently coordinate all the different work happening at the home.
If you followed the advice to be the one who hired the floor installer, then you should make sure he bills you directly. Do not let the store you bought the materials from get involved in this step; they will probably try to add their fee. You should have it established with him from the very beginning that you are the one who is hiring him, not the floor remnant store.
No matter how great the contractor is, you need to keep an active presence on the worksite making sure things are done to spec and are on time. Time is money!
Costs to Expect
In many old homes, the floor is in bad shape. Sometimes previous home owners have installed vinyl or linoleum on top of an older layer and it all needs to be extracted. There should never be more than two layers of vinyl floor installed. More layers mean more room for trapped moisture, a spongy feel when walking, and instability. Even worse, moisture from the kitchen and bathrooms may have rotted the wood subfloor. This will mean a bit more money from this flip needs to be budgeted for the floors, but look on the bright side; You may get very lucky and discover original hardwood underneath an old carpet.
The removal and disposal of old carpeting will cost you extra if you dont do that yourself. You can expect to pay approximately fifty cents per square foot for them to get rid of it. You can expect to pay the same if you must have new pad laid. The pad will make the carpet more comfortable to walk on and even increase the life expectancy of it; just something to consider. Carpet installation can run you anywhere between three dollars per square foot to six depending on the kind of carpet and region where you live.
Those vinyl peel and stick pieces can run you as low as 40 cents a square foot. A higher quality of strip will cost twice that but you can use it in houses above the entry level market. Vinyl flooring is often measured by square yard instead of square feet. You can convert your square footage measurements to square yards by taking the total square footage and dividing it by nine. Square footage of the room is length multiplied by width (L x W=SqFt), so you will need to divide this number by nine to get the square yards (L x W/9=SqYd). For instance, a vinyl floor for a room that is 13 x 20 feet is 260 sqft. 260/9 gives you exactly 28.89 square feet, or at least 29 sqyd of vinyl flooring to purchase depending on how it is sold. If you opt for the most popular types of vinyl floor today, you will probably land at an installation cost of about five dollars per square yard.
If all you need to do is refinish an existing wood floor in your next house flip, you can expect to pay approximately $3.50 per square foot. Not bad considering the value of real wood floors in most markets. This is usually a five-day process, so factor that into your flipping schedule accordingly. If you need all new hardwood flooring installed into a home for sale, you may be able to get it at $7 per square foot, labor included.
A tile floor should always be laid on top of a backer board. The cement will bond the tile to the backing but not to a wood subfloor. If you do not already have this available, you will need to factor this into the budget. It is generally sold as 3 or 4-foot-long sheets.
One last thing to consider when having someone install flooring in your investment property, many contractors will have a base price. No matter how small or cheap your job may be, you may have to pay a base price to make it worth the contractors time. If you ever have work that falls under a base price, it would be great if you can do that work yourself. This is where the journey of being a serious house flipper begins; becoming knowledgeable of not only how to find the best material and contractors at a great price, but also how to perform some tasks on your own to maximize the sweat equity. Not only will learning how to perform some home renovation work yourself save money, it will make you a better judge of a homes condition so you know which fixer uppers are worth the investment despite how they appear on the surface. You will also learn how to negotiate with contractors better and estimate the duration of tasks more accurately.
Think Outside the Box…
Instead of buying everything at the big box store, you should always be looking for the stores that sell below retail. Most of the time this is for selling material that may be slightly flawed or leftover from other large orders. Don’t be afraid to pick through it to find the very best stuff at a discount.
You Will Make Mistakes
You never stop learning, so even an experienced and successful house flipper will make some bad moves that cost major money. The principles you learn here and in other advice is only going to minimize risk, not eliminate it. You must roll with the punches and treat every mistake as an opportunity to learn something valuable for the next flip.
Understand Your Market
At every step of the process, you must remember the kind of home buyer you are intending to sell this home to. In general, you need to match high-end flooring materials with a high-end real estate market, and the low-end should receive more affordable flooring. It is great if you can put in a design flourish a little above market to really sell the house fast and make a happy customer, but be smart with your money to maintain the best return on investment possible. You should always begin a new project with an after-repair value (ARV) calculation done. ARV is simply the price the home can sell at when all work is done. Subtract all costs (real estate, repair, monthly carrying costs) from the ARV and that is the ballpark estimate of what you are likely to walk away with when it is all said and done.
Good luck with your next flip!
This article was written and submitted by Daniel at YourFloorGuys.com.