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How to Flip a Duplex

When it comes to flipping a home, renovating a duplex can be a lucrative option. Not only can these properties be slightly easier to grab up in the first place, but when done right, they can draw a lot of interest. Duplexes are a great compromise for people that don’t want apartment or condo dwelling but don’t quite have the funds for a single-family home built on a large property. If you want to successfully flip a duplex it will take some careful planning and thoughtful design choices.

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9 Points to Consider Before You Flip a Duplex

Initial Questions to Consider

Before you can even start to plan out flipping a duplex, you must first consider how the space will be used when you are done. The answers to the questions below will go a long way to helping you determine what types of products to use and whether furnishing the space will be necessary.

  • Are you selling the duplex to one person or two people?
  • Are you keeping the duplex to use as a rental?
  • If you are using it as a rental will it be a long-term rental or a vacation rental?

Come Up with A Timeline

Before you can wrap your finances up into a duplex flip, you have to carefully determine how long the rehab will take and what the total price of the materials, labor, and carrying costs will be during that timeframe. Once you come up with that total cost output, carefully consider how much the property will be worth when you are done and make sure there is still some profit left in the investment. Sometimes, proper planning is the best way to stay on budget with your renovation.

Consider Financing

Purchasing a single-family home is one thing but deciding to flip a duplex is quite another. It often requires a commercial loan. Because these loans are much trickier than a traditional home loan, make sure all your finances are lined up in advance to prevent surprises at closing. If you plan on living in the unit yourself, the fact that you’ll be renting half of the property out to others will help the loan be more appealing to the bank.

Check Up on Codes

Every city has different rules when it comes to multi-family dwellings. Make sure you check up on all the rules at the beginning of your project to avoid problems getting permits to pass down the road. Chances are, if the property is already constructed as a duplex, it is located in the area that allows for multi-family dwelling. If you have a large home you’re splitting into a duplex, more research will be required.

Renovate One Unit At A Time

When you start your renovation process, do the things you have to have both units vacated for first. Then, focus your energy on a single unit. When one unit is done it can be used as a rental while you’re completing work on the other unit. This will help you generate some money from the property and help recoup some of your carrying costs.

Of course, you’ll have to make sure your renter knows there will be some noise next door during the days. Lower the rent slightly from the market value to make the noise worth it for the tenant. When both units are done, you can even list it for sale with a tenant still in one unit. This helps alleviate the new owner’s stress about finding someone to fill the space.

renovation team

Choose Materials Based on the End Goal

Really look at the competition before deciding what materials to use inside the property. You want to elevate your duplex above the competition enough that it will get snatched off the market quickly but you don’t want to dump so much money into high-end materials that you can’t get those expenses back in the sale price.

If you are planning on renting out the property yourself, either as a long-term or a short-term rental, you’re going to want to take a somewhat different approach. Look for incredibly durable materials that will hold up to renters. Instead of carpet opt for a commercial-grade luxury vinyl or durable tile flooring. You’ll find that spending a little more in the beginning on commercial-grade materials will cost you far less in repairs down the road.

Focus on Functionality

Typically, duplex units are smaller than a standard single-family home. Make sure that the unit provides all the function you’d see in a single-family home worked into a smaller footprint. Really focus on the flow through the kitchen and the storage available in that space. Adding an island, peninsula, or additional work area is a great way to maximize prep space while providing a casual dining alternative. An open concept floorplan will always provide the most versatility when it comes to furniture arrangement.

Adding Furniture to the Flip

If you are putting the duplex up on the market, both units will need to be staged. What about rentals? If you’re planning on renting one or both units out, do market research on whether furnished or unfurnished rentals are moving off the market faster. Perhaps you live in a vacation destination and plan on using the unit as a short-term rental. They will need to be fully outfitted with furniture that will hold up to guests coming in and out. No matter how you plan on using the space, the furniture for both units will be a definite cost consideration.

Market the Property Appropriately

There’s a lot of appeal in having a home that can also generate money to offset your mortgage. When marketing the property to individuals, make sure to focus on the benefit of having a tenant in one unit to help lower the overall cost of the mortgage and help gain equity in the property. Keep in mind that not everyone will want to share their home with a tenant, so it is bound to narrow the number of house hunters that are willing to entertain the idea of your duplex.

A duplex can be very appealing to investors, as well. Duplexes are a great addition to their real estate portfolios because they can often rent both units for a higher total cost that the mortgage on the property. Making the units completely turn-key and renter ready will help you achieve top dollar from investors.

Read to Flip a Duplex?

When it comes right down to it, the actual renovation of each unit is no different than the renovation of any condo or single-family home. The real considerations and tricks for flipping a duplex have more to deal with who you’re marketing the property to and how you plan out the entire flipping process. Flipping the first duplex is always the hardest but with proper planning, it can be a huge success.

flip a duplex

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