Is there a difference?
Yes, yes, and YES! There is a HUGE difference between a flipped home and a renovated home. The biggest difference – the end result! There is nothing wrong with a seller wanting to make a profit, but not when a home is compromised and home repairs are covered up.
Flipped Homes
A flipped home typically has a lot of shiny objects and leads the buyer to believe they are purchasing a move-in ready home. Issues can arise after the buyer moves-in and slowly discovers the mechanicals behind the walls were never updated. So those gorgeous tile floors and the super sleek and sexy cabinets have to be ripped out to fix something the owner who flipped the home covered up.
Does this mean all flipped homes are lemons? Absolutely, not! As long as you do your homework and hire the right professionals, you can find great flipped homes.
Renovated Homes
A renovated home has the shiny objects, but the big difference: the owner took the time to repair all the parts you see and the mechanicals parts you don’t see. The end result of a renovated home is to improve the quality of the entire home. In most cases, the owner hired licensed professionals, received permits, and had proper inspections for the work done on the home.
Does this mean all renovated homes are gems? Absolutely, not! Some owners hire unlicensed professionals or use lower end products that may look nice, but in the long run, they will not withstand the test of time. To protect yourself, always work with the right professionals who know how to spot compromised repairs and can verify the work was done by a licensed professional.
Here are a few differences between a flipped home and a renovated home:
Flipped Homes
- Flipped homes are bought at a lower price, updated on a surface level and then re-sold for more.
- Renovations are focused on the profit.
- Mostly focused on cosmetic aspects of the house.
- Renovations are restricted to a dollar amount based on profitability.
- Spending stops when the marginal cost is exhausted.
- Flipped homes can be ethical, if the intention is not to defraud the buyer.
- Price of home should be based on the improvements made and not based on the ones assumed to be made.
- Work done on the home may not come with any guarantees for parts, labor or workmanship done on the home.
Renovated Homes
- Home renovation means taking something old and turning it into something new.
- Renovations focus on the results.
- Intended to improve the home.
- The process of improving a broken, damaged or outdated structure.
- Renovations done on a house are typically higher quality and intended to be long-lasting.
- Renovated homes can also be sold for a profit.
- Architectural plans may come with the home along with warranties for labor, parts, and work done on the home.
- Depending on the extent of the remodel, permits will be filled with the city and must be approved by the county or city.
At the end of the day, there are some great move-in ready homes out there! Flipped or renovated, work with the right professionals like an experienced Realtor and home inspector, who can spot the differences.
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