I received a great question the other day from one of my readers:
I have a question for you – how do you determine the finish level of the flooring for your houses? I have a pretty good handle of the finish level for most of the house I am offering on, but I’m really stuck on the flooring. Carpet would be most economical and would be in line with most of the neighborhood. New, neutral carpeting would be ahead of most comps, which either have older carpeting or new but very taste-specific carpeting (off white with a bright red border?) But there’s a house, same neighborhood and similiar size, type, etc., that is on the market for about $40k more than I plan on listing my (hopefully) house at. It’s a rehab and flip too. This house has new hardwoods. I’m really not at all certain that the extra $40k is realistic in the neighborhood, but obviously, the floors really look fantastic. What would you do in that type of situation?
Before you consider the answer to this question, take a look at my latest article in the Education section of the site:
Hopefully this will give some insight into how I make rehab decisions such as this the one posed above. So, what do you think the right answer is?
I’m guessing many of you — after reading that article — will say that it’s a good idea to put in hardwoods in order to keep up with the competition of the other house listed for sale in the neighborhood. But, remember one thing: it’s quite possible that at $40K more, this other house is not actually competition. For example, if reader’s house is listed at $120K and the other house is listed at $160K, it’s very unlikely that the two listings will attract the same set of buyers.
With that in mind, I believe the question-asker answered her own question when she said:
“New, neutral carpeting would be ahead of most comps, which either have older carpeting or new but very taste-specific carpeting”
And that would be my suggestion…put in new, neutral plush carpeting, save a few thousand dollars by not putting in hardwoods, and still have a house that’s nicer than the competition.
Btw, if you have any questions that you think I might be able to help with, don’t hesitate to send them along, either in a comment or an email…