An iffy condo market has many investors abandoning flipping for a buy-and-hold strategy, but that may not be necessary, says one award-winning investor, suggesting there’s still profit to be made in selling up instead of renting out.
“The key is to make it sexier!” says Emil Kiriakos. “I travel and visit hotels a lot, such as the W hotel, and I take pictures of the décor and then replicate it in my units. I try to make my properties more attractive than everyone else’s.”
Even in this market, Kiriakos is still finding success buying and selling condos. He’s buying along the waterfront and in the downtown core of Toronto, a market that has now seen a 30 per cent pullback in investor purchases as concerns about a possible value correction take hold. That speculation hasn’t deterred Kiriakos, who continues to focus on preconstruction buys – at preferred pricing – and flips after a sizable investment in staging.
For example, if he takes possession of a condo along the waterfront, he decorates it with a nautical theme to appeal to buyers. For units in the financial district, he fashions them after an executive suite.
According to Kiriakos, the steps to success are simple. Here are five pieces of advice to bear in mind:
5 Steps to Condo Flipping Success
1. Be unique. The boxy, new condos don’t go as fast as the ones with character and appeal, so get creative with your unit to flip it. Furnish the unit with good taste to create the WOW factor. There is a lot of inventory in the market, so don’t be afraid to list your unit under the market value to get it sold first.
2. Buy in a great area that is in demand. You can still sell above the asking price. In the worst case scenario, in Toronto, at least, you’ll get your money back. But you will never lose, says Kiriakos.
3. Budget Wisely and spend no more than $3,000 on renos. It’s key to buy quality stuff, so when you sell the unit, you can either keep the decorations for an extra couple of grand, or you can hang onto it to use again. Also don't shy away from high-end upgrades such as undermounted sinks, but remember, decorating isn’t the end game – getting them to buy the unit is.
4. Try to use OPM – Other People’s Money. If you can’t do it alone, don’t abandon the idea. Find a partner to do a JV.
5. “Just Do It” – as Nike says! There’s analysis and then there’s procrastination. We have to do our due diligence, think about our exit strategy and follow all the protocol, he says, but then you have to make a decision. Love what you do and do it with love and you will see the result.