This is the seventh episode in our seven part course ELEVATE Your Flip.
The final details of a project are the most important to a successful sale and achieving top dollar for your project price point. We discuss the nitty gritty details of a punch list walk through with contractors and final payments. The goal is to have a win-win project wrap up, so you can work with the contractor on another project while finishing on time and on budget. This episode walks you through how to get your property ready to list.
This episode covers:
- Blue tape punch list walk through
- Final GC, sub, vendor payments
- Fine points – listing keys for single family properties and condo communities
- Home stretch details: cleaning, staging, photos, MLS listing
This post is part of the ELEVATE Your Flip Course. The course gives you an introduction into fix and flipping properties in Denver.
Three Learning Options:
- Listen to episode “#133: Flip #7 – Final Details and Listing Success Strategies for Your Flip Project” on the Denver Real Estate Investing Podcast
- Watch the YouTube video at the bottom of the page.
- Read the blog post.
Blue Tape Punch List Walk Through
As your project is wrapping up and in its last week of rehab, it’s important to take action to prepare your property for listing. You don’t have to wait until everything is perfect to start the steps. In fact, it saves you time and money to act early and start on these tasks while your contractors are still putting the finishing touches on the rehab.
The first thing you’re going to want to do is have a blue tape walk through with your contractor. That’s where you walk through the property with your roll of blue painters tape and mark anything that needs to be addressed. This may be a loose fixture, touch up paint, a grout line that needs to be refilled, etc.
This is especially important if you’re working with a new contractor who isn’t used to your level of attention to detail and standards. As you work with them over time, the number of blue tape marks should decrease.
Expect the walk through to take 1-2 hours depending on the size of the home. We prefer to do the walk through by ourselves without the contractor and then meet with the contractor afterwards to go over the details of what needs to be done. All repairs and corrections should be completed the week before you expect to list the property.
We are very detailed in our inspection. A few of the items we check are:
- Every faucet and let them run for a while to make sure there are no leaks.
- All the electrical using an outlet plug to make sure there is correct power.
- Test the garage door
- Gutters and downspouts
- Every wall for paint or drywall chips
- Door stop on front door
- Open and close all cabinet doors to make sure they line up
Final GC, sub, vendor Payments
We know that when we sign off with our contractors, final payment is due, so we make sure everything is completed to our high standards. We don’t want anything to distract potential buyers when they are walking through the house.
Once the contractor completes our blue tape punch list, payment is made and the contractor is free to move on to the next project.
Fine Points – Listing Keys for Single Family Properties and Condo Communities
Pricing Strategy For The Home
We determine sales prices for our properties using a velocity of money theory. We want to flip as many houses in a year as we can with the money we have. We look at comps on the frontend to determine what we think we can sell the home for on the backend. We then price it slightly below any similar active properties on the market that are updated and renovated. We look at the square foot cost of similar properties on the market to achieve this. We want the home to be the best quality product at a super reasonable price and would rather price it a touch low and have buyers bid it up or multiple buyers to pick from. We get more views on the listing with this strategy which leads to more potential buyers through the door. Time is money, and pricing a home correctly can save time.
Maximize Curb Appeal
If we are near the end of rehab and on budget, we will evaluate the market and consider adding a pergola on the back. The pergola creates an area for outdoor entertaining and increases perceived value which can give our property the extra appeal it needs to draw in potential buyers.
If it’s Spring or Summer, we may spend a little more on landscaping to add to the curb appeal of the property. We may add flower beds in the front or a fire pit in the backyard complete with Adirondack chairs. It’s important to consider what time of the year you’re hitting the market and improve the property accordingly. In Winter, the firepit addition won’t create the same level of perceived value for buyers.
Home Stretch Details: Cleaning, Staging, Photos, MLS Listing
As we head into the home stretch the week before our property is set to hit the MLS, we pay special attention to the fine details.
We always stage properties. Even in a sellers’ market we stage properties. On average, our staging price is $1,000 to $2,000 per property which includes the consulting fee of the stager and renting the furniture. It’s 100% worth it for all property types.
Real Estate Agents
We have an agent in house to list our properties. However, if an agent brings us a property to buy, we are happy to commit to making them the listing agent on the property as well once it is fixed up and ready to go back on the market.
Our advice to flippers who are doing it themselves is to find and hire a licensed agent who has expertise in selling fixed up flip properties. Do yourself a favor and do not hire your cousin who just got a license.
It’s important to hire professional cleaners. The contractor should leave the property “broom clean” but should not be expected to leave the property listing clean.
The Elevation Toolbox
We show up with our Toolbox after the professional cleaners have done their thing and make sure the property is listing ready. Our toolbox includes anything we may need to get the property in showing shape including air fresheners, door mats, window cleaning supplies, etc. We have been known to clean the condo entryways leading to our listing and mow neighbor’s yards to enhance the curb appeal.
We use the following timeline the week prior to listing our properties to keep things on track.
- Monday: professional cleaning
- Tuesday: professional staging
- Wednesday: professional photos
- Morning: toolbox walkthrough and cleaning; get photos back
- Afternoon: put photos on MLS
- Friday: listing goes live on MLS
- Saturday of the next week (8 days later): Open House
We like to schedule the open house a full week after the property is listed. We have found that open houses don’t work well for us to find buyers. Pricing the property right brings us buyers. We use open houses to meet the neighbors, network and for lead generation.
Our goal is to have as much activity as possible and find the right buyer who will close quickly and without issues. We never assume multiple offers or put instructions for multiple offers in the listing notes. Our agent picks up the phone and calls the buyers agent to find out about the potential buyers and get a good read on them.
If we’ve priced the house right and reasonably, the appraisal shouldn’t be an issue. If a potential buyer agrees to cover any gap between the sales price and the appraiser’s value, that buyer goes to the top of our list.
We print off in color our relevant 5-6 comps and leave them on the kitchen table for the appraiser to find. We will also provide our Scope of Work to the appraiser if asked. We are also not shy in explaining our pricing logic to appraisers. For example, if our property is a unique mid-century modern, we will pull a larger comp radius to pull in other mid-century moderns and point that out to the appraiser.
We attend every closing and use it to build rapport, build our brand, network and thank the buyer. We point out that we pay four figure referral fees and hope they’ll remember and refer us in the future.
Once the funds are wired to our account, we move on to the next project. Later as a team, we then review the deal and discuss what went well and what we could have done better.
We would love to work with you!
If you’re interested in working with us, here are options to consider:
- Level I: ELEVATION Academy. Intense 2-day learning academy. In person in a classroom and in the field in Denver.
- Level II: Individual Consulting on a project basis. You fund the purchase of your own property and your own rehab. We help take you through every step of the process. We meet with you 1-3 hours a week in person.
- Level III: Partnership Flip. We work with a client who has a property with good bones. We partner with the homeowner and use ELEVATION rehab dollars, team members, and contractors to run the project. We do a profit share on the backend with our partner who may not even be involved in the flip process but want to share in the profits.
Go to the Denver Fix and Flip Investing Consultation page to learn and more and schedule a call.
Webinar recording – Watch it here or listen to the podcast.