The tools and materials can be expensive on rehabs, but their costs also can break your budget, especially if they’re unforeseen. “Flippers really need to save money on tools and materials because the unexpected things that happen during flips can also be expensive,” says Mindy Jensen, a community manager at BiggerPockets.com, a social network for the real estate investing community. “Those extra costs have to come from someplace,” continues Jensen, a flipper since 1998 who is passionate about real estate. (She has flipped eight houses and lived in every one of them!)
Affordability is key when planning your next fix and flip, but they must be appealing to your market, too. That means cheap materials are out of the question. Not to mention that you’ll want your tools to last through multiple flips. So, how do you create beautifully renovated properties in your market while saving money in the process? Here are six easy tips:
1. Capitalize on Other’s Mistakes
You’ll need a lot of paint for your rehabs because paint can make a house feel and look totally different. However, you don’t need to invest a fortune in paint if you head to the “oops” section of any big box hardware retailer, paint supplier, or some outlet stores.
“My local Home Depot sells mis-tinted or ‘oops’ paint for $7 rather than $35,” explains Jensen. “Find two colors close together and mix the two, or mix a much darker one with a lighter color.”
2. Get Thrifty with Second Hand Stores
Buying used and saving the difference can add to your resale bottom line. One popular thrift store frequented by many successful flippers is the Habitat for Humanity ReStore. Located nationally, you can get everything from tools to cabinets and appliances – for less. “Sometimes things are brand new and other times, they’re used or leftover,” says Jensen.
But don’t rule out other local chains and single location stores. While Jensen doesn’t make them a steady source of materials, “shopping at those where the surrounding area is affluent means you’re likely to get higher quality finds.” And, if you’re creative, you can use those to create one-of-a-kind furnishings like a bathroom vanity from old dressers or tables, she says.
3. Catch Sales on Secondary Holidays
Yes, you can get deals on tools and materials during major gift-buying holiday sales. But if you really want to save those rehabbing dollars, Jensen says the sales during holidays like Columbus Day, President’s Day, and July 4th are your best bets.
“Those are the sales where you’ll see two tool sets for the price of one,” she says. You’ll also see a lot of multiple-piece tool sets and other materials. “If you know what you’re going to do to a whole house and something is on sale, buy it,” she adds. You always can store it in a garage, shed, or storage unit for later use.
4. Go Ritzy with CraigsList
Jensen says that when she shops on Craigslist, she looks for free or low-cost, upscale materials in affluent neighborhoods. “That’s not to say there aren’t deals to be had in other areas. But wealthier people often don’t mind selling for a few hundred dollars or even giving away expensive cabinetry, appliances, extra tile, or other materials you can use in your flips.”
“Much of the time I find they just want me to come and get it so they don’t have to haul it away,” says Jensen. Consider CraigsList competitor OfferUp.com, too.
5. Spend More Time Online
Another source of tools and materials of all types is Amazon.com’s Warehouse Deals. Or, if you’re looking for online discounters that specialize in building materials and tools, shop on BuildDirect.com and Build.com. To save even more, do your shopping through a cash rebate site like ebates.com and get discounts and quarterly cash rebates on your purchases. Jensen has used Overstock.com to find bathroom vanities. “They tend to have more edgy, contemporary styles. When you’re flipping an $800,000 house, you don’t want a generic vanity.”
6. Sharpen Your Bidding Skills
If you’re both competitive and enjoy getting a deal, online auctions are a great way to save on rehab tools and materials. Sites like eBay and government auction sites, such as GovDeals.com or SalvageSale.com, where you can get large pieces of construction equipment that you’ll repeatedly use, can yield great deals. You can also conduct a Google search for local auctions. If you can bid on the right tools and materials at the right time, you can practically steal some goods. Just set a maximum spending limit and stick to it.
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