When most people are looking for a home to buy, an outdated kitchen, faded paint, or a bathroom in need of a repair are not usually appealing attributes. But where some see red flags, others see opportunity.
Tricia Peterson of Island House Real Estate is one of many realtors, contractors, investors and others who have discovered the benefits of fixing and flipping houses.
“Seeing the progress is amazing to me, having the vision to find a house that most people would not want and turning it into a house that is beautiful is so rewarding,” said Peterson, who works with locally-based Maverick Construction and Embellish Interiors in purchasing several homes a year for the purpose of doing extensive remodels and reselling. “Our contractor team only works on our projects and has the process so fine-tuned that we often can complete the projects in just a few months.”
“My job is really to come in and look at the space and see if we can do things,” said Nicki Newport of Embellish Interiors. “Each house has its own personality and budget. So it’s kind of fun to pick tile and lighting and the details that we’re gonna do based on either a specific kind of style that the house dictates or something that we’re interested in trying.”
According to Newport, she and her husband, Kyle, owner of Maverick Construction, have worked with Peterson in flipping about 15 homes so far.
“It’s good,” she said. “It’s a little switch for me not working with interior design clients because we make the decisions...It moves really fast and the projects go quickly, which we really enjoy. And Kyle has his own subcontracting crew that works on all these houses so that really helps us stay focused.”
So how do you determine if a purchase has “flip” potential?
“Have professionals give you estimates and a time frame for completion for the work you want to do, so you have an accurate all-in expense and realistic expectation up front of the project,” Peterson said. “Not every house is a good fit for an investment property. In fact, probably 90% aren’t a good fit, so work with a Realtor that is honest and works in this world of investment properties so you are getting the right advice and making the right decisions on selecting a property. This is the most important part, if you buy wrong, you will not be successful.”
Even today’s real estate market, in which prices are escalating and inventory is low, can offer some good contenders, noted Peterson.
“The market has made finding suitable properties more and more of a challenge,” she said, “but the rise in prices has helped with the resale and rental options on the completed side so it can still be a good time to do this.”
The goal, of course, is to come out in the black when it comes time to sell.
“It is a great way to generate income and it is also very rewarding on a personal level,” Peterson added. “It is an overwhelming sense of accomplishment to complete a successful remodeling project. Many homes are in need of repairs or outdated and with the new home building expenses on the rise, remodeling these homes for resale is a phenomenal way to offer an alternative product.”
Some properties, however, will just not be well suited for flipping.
“Every project is different as far as what to look for and what potential red flags would be,” Peterson added. “It really depends on your comfort with the risk level.”
Former Cainhoy peninsula resident Jessica Slabaugh didn’t set out to do a quick flip on the starter home she and her husband, Zach, purchased in the Retreat at Beresford community in 2017. They had planned to do some home improvements to the property and then sell to purchase something on Daniel Island in five years. But their timeframe accelerated in 2021, when the real estate market began to soar. They had previously purchased an Airbnb in Knoxville, Tennessee, so when their local home sold within five days of being placed on the market, for nearly $157,000 more than they paid for it, they had somewhere they could go to relocate.
“It was all part of the strategy in the sense of why we were able to flip our house and leave Charleston, because we had our rental property to go to,” said Slabaugh, who did most of the improvements and upgrades to her Charleston property herself, with her father’s help.
While Slabaugh attributed much of their success to “good timing and luck,” she also credited her friend and Realtor Terry Haas of Century 21 Properties Plus for expertly guiding them throughout the process.
Slabaugh said, “She really helped me and educated me,” said Slabaugh. “I was willing to do all the work in flipping it, but her knowledge of the market and just knowledge of buyers and what they look for was huge!”
Slabaugh’s advice for homeowners interested in flipping a property is to start small.
“Start with something like a cosmetic update to build your confidence in what you can do,” she said. “Don’t take on a project that needs every room fixed or gutted!”
Slabaugh and her husband are thankful they were able to turn a good profit on their Charleston home and are looking forward to relocating back to the area once the market levels off to start their next real estate project.
“This is definitely a sellers’ market right now,” she said.