Tarek El Moussa of “Flip or Flop” has helped many aspiring house flippers make a profit on his new show, “Flipping 101 With Tarek El Moussa.” But as the latest episode makes clear, they’re not all success stories.
In the episode “Style vs. Substance,” El Moussa helps Kenny and Somer with their house in Pasadena, CA. It’s a beautiful home they’d bought for $1,250,000, but it’s an overwhelming amount of work for these first-time flippers. Kenny and Somer’s subcontractors are disorganized, and with an unexpected change in the market, this flip could turn into a money pit.
Read on to learn El Moussa’s best money-saving renovation tips—plus two upgrades that often aren’t worth the expense.
Smooth stucco gives a home’s exterior a sleek look
When Kenny and Somer first show El Moussa the house, he’s impressed by the exterior. He likes the shape of the home and even mentions that the stucco is in good shape. However, Somer and Kenny say that they’re planning on replacing the textured stucco with smooth stucco.
“Smooth stucco would be a lot nicer,” El Moussa says in agreement.
In the end, Somer and Kenny give the exterior a fresh look with new stucco and a lighter color. It’s a great choice, making the home look more modern.
El Moussa may have liked the exterior before, but now it’s even better.
Embrace your home’s unique style
El Moussa may approve of this home’s exterior, but he’s a little more hesitant when it comes to the layout of the living area. The large room has big windows and a dual-sided fireplace.
El Moussa knows it won’t suit everyone’s taste, but he encourages these flippers to embrace the home’s unique style.
“When you’re dealing with midcentury- or funkier-style houses like this, it can alienate a lot of buyers because of the way it’s laid out,” he says. “But at the same time, if you nail the design and you find that buyer that likes that style, you can hit a home run.”
It’s a good lesson in knowing what to change in a house and what to embrace. This house has a midcentury modern look, and as El Moussa suggests, it’s probably best if Somer and Kenny focus on that style.
A flashy staircase can be a waste of cash
Kenny and Somer have big plans for this house. For one thing, they want to take out one wall, push the stairs out, and put a glass case around them. However, El Moussa says they shouldn’t waste money on such a flashy feature.
“Big stuff like that, it’s just really hard to get a return,” he explains, “but if you did a really killer stairwell in this area, it would look really, really nice.”
El Moussa reminds these flippers that it’s important for a homeowner to always think about resale value before starting a project. While they might be interested in a trendy, custom feature, it will probably be better in the long run if they stick with a well-made, tasteful, and timeless design.
Moving the kitchen can be a money pit, too
While El Moussa is able to talk Kenny and Somer out of an expensive staircase renovation, they decide to go against his advice and start an expensive kitchen renovation. This project involves an addition, and requires moving the kitchen to another part of the house.
As El Moussa points out, the idea to make the kitchen bigger is fun and creative, but it’s not a necessity.
“It sounds pretty neat,” El Moussa says about Somer and Kenny’s vision, “but if I were flipping the house, I’d probably just leave the existing floor plan.”
Despite El Moussa’s advice, these flippers go on with their new plans for the kitchen renovation, embarking on a long and expensive journey.
A high-end house deserves high-end materials
Somer and Kenny don’t take El Moussa’s advice when it comes to the location of the kitchen, but they’re ready to listen to his tips when it comes to choosing materials.
When it comes time to choose a backsplash, Somer explains that Kenny wants to install white subway tiles, while she wants a more expensive marble herringbone.
El Moussa says they should go with the more expensive tile.
“I’m OK with them spending more money on material, because it’s a $2 million flip,” he says. “Buyers expect the best, they expect quality, and they’re going to be looking at every detail.”
Is this ‘Flipping 101’ tutorial a success?
When El Moussa first sees this house, he says it will be a very risky flip. He warns Somer and Kenny that if everything doesn’t go as planned, it could mean big problems.
Unfortunately, it seems nothing goes as planned with this project. Kenny and Somer have a disorganized renovation team, work goes slowly, and the market plunges.
By the end of this episode, Kenny and Somer are still working on the project with no end in sight. With a purchase price of $1,250,000, a rehab budget of $150,000, and interest and closing costs estimated at $140,000, El Moussa calculates that these flippers would break even at $1,540,000.
With comps in the area coming in around $1,800,000 to $1,900,000, they expected big profits.
However, after seven months, El Moussa admits that these two are 10 weeks behind schedule and $90,000 over budget. Still, he says he’s going to continue working with them—and hopefully all their renovation work will be worth it in the end!
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