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Tarek and Christina El Moussa

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Exclusive: Tarek El Moussa Reveals What Turns a Real Estate Deal Into an Epic Flop

October 26, 2018

Negotiating a real estate deal can be a daunting endeavor. There’s so much at stake! As a house flipper who’s bought and sold hundreds of homes on “Flip or Flop,” I’d be the first to say that I’ve made plenty of dumb mistakes that cost me hundreds of thousands of dollars.

If I’ve learned anything, though, it’s that you don’t have to brave the home-closing process alone. A whole cast of professionals can save a seemingly doomed deal, and while they charge for their services, I’m going to explain why they’re worth every penny. Allow me to introduce you to three key players you may meet in the process of buying, selling, or financing a home, and how they can keep your deal from imploding.

A mortgage broker

When I was 21, I wanted to buy my first home, and I found the perfect property in Orange County, CA—a bachelor pad complete with a shark tank.

I was so excited and ready to buy that home, I went to a lender to get qualified for a loan. This person told me I’d need a 20% down payment … but all I had was 10%. As you can imagine, I was pretty bummed!

But I didn’t give up. Searching for alternatives, I came across a mortgage broker. Unlike a lender, a broker has access to dozens of different banks with different financing guidelines. By shopping around, this broker was able to find me financing with only 10% down.

It put my dream home back within reach.

What I learned is that if you’re struggling to find good financing, it’s worth checking with a mortgage broker who can do a deep dive through all your options. Granted, mortgage brokers do charge for their services, but it ends up costing about the same as a bank. I, for one, wouldn’t have been able to buy my first home without a broker’s help.

A home inspector

Many years ago I was working with a buyer who fell in love with a house that was pretty much new. Since the place looked so pristine, the buyer didn’t want to bother hiring a home inspector—in his mind, it would be a big waste of money. What could possibly be wrong with a new house?

But I was adamant that he hire a home inspector anyway. And a good thing, too! During the inspection, we learned that the roofing used on this house was so heavy, the structure below might collapse beneath it.

Can you imagine if we hadn’t done an inspection and this buyer had moved in? Disaster.

We were able to negotiate with the seller and demand they repair the roof to the tune of about $20,000. Home inspectors typically charge $300 to $500—a small price to pay to protect what will probably be the biggest purchase of your life. Right?

A real estate agent

Odds are, you’ve wondered what real estate agents do to earn their commission, which varies by agent but hovers around 6%. On a $300,000 house, that amounts to $18,000.

While this might seem like a lot, home sellers should keep in mind that their listing agent splits this fee with the buyer’s agent, so it’s already down to about 3% each. The commission also goes toward a whole bunch of other expenses, including the money it’ll take to market your home.

While it might tempting to cut corners and try to negotiate with an agent for a lower commission, all I’m saying is, you get what you pay for. Really.

A few months ago, I met with a guy who wanted to hire me to sell his house, only this guy was looking to save some money, and offered me a 4% commission.

I said I wouldn’t do it. He was shocked.

“I’m sorry, but my time is valuable, and 4% was not worth my time,” I explained.

He didn’t believe me, so I politely thanked him and we parted ways.

A half hour later, he called me and offered me 4.5%.  Again, I said no.

This seller did eventually find an agent willing to take 4%. Only once his house was listed, it just sat on the market untouched. After three months with no buyers, the listing expired … and the seller called me, again, agreeing to pay my full commission.

Within three days of listing the home, I generated four offers and sold it for $20,000 over the asking price that the previous agent had set.

My point is not to pat myself on the back. (At least, not much.) It’s to show that many home sellers’ efforts to save money can backfire, badly.

You don’t make money selling your home by reducing commission. You make money by hiring a great real estate agent who’ll sell your place for the highest price possible, while answering the many questions you’ll have along the way.

Follow Tarek on social media @therealtarekelmoussa, and if you’re thinking of selling your home, buying a new one, or in need of some renovation, take a look at Tarek and Associates for more information.

The post Exclusive: Tarek El Moussa Reveals What Turns a Real Estate Deal Into an Epic Flop appeared first on Real Estate News & Insights | realtor.com®.

Did Tarek El Moussa Just Out-Design Christina? A Shocking ‘Flip or Flop’ Season Finale

September 8, 2018

“Flip or Flop” has just aired its Season 7 finale—and if you’re incredulous that the recently divorced Tarek and Christina El Moussa made it through without strangling each other, you’re in good company!

Yet their final flip of the season proves to be one of their most challenging … and tests their abilities to get along more than ever.

In the episode titled “Infested Flip,” the El Moussas have chosen a 1,200-square-foot house in Santa Ana, CA, that turns out to need a lot of work before it’s market ready.

“It’s a nightmare in here,” Christina says, wrinkling her nose. “The whole thing’s a hot mess!”

Upon closer inspection of the house, contractor Jeff Lawrence tells them the house has the “trifecta” of troubles: plumbing, electrical, and subfloor.

As Tarek and Christina struggle to make a profit on the home that is literally rotting beneath their feet, they deliver some fascinating tips that could benefit home buyers, sellers, and renovators alike. Here’s what we learned.

House in bad shape? Lowball before you buy

Tarek says that the house “has a lot of issues, which means we might be able to get it below asking.”

And does he ever! The list price is $450,000, but the owners eagerly accept his opening offer of $400,000.

Because the home sellers didn’t bother to negotiate, Tarek suspects that he should have made an even lower offer. But he can’t complain; it was almost a 20% reduction.

Open kitchens make a big difference

Lawrence tells them it’s going to cost $4,000 to remove the kitchen wall for a more open floor plan. That’s a lot, but Tarek and Christina believe it’s worth every penny.

“An open kitchen will add a lot of value,” Tarek says.

Rethink those black countertops

Because the house is small, Christina wants to go big on design, so she suggests white cabinets and black countertops. Tarek tactfully steers her away from that idea, telling her he thinks black might be a little too bold and overpowering. Plus, black shows water marks, and is hard to keep clean. Christina concedes, acknowledging that white countertops will make the kitchen look more open and bright.

Make the ceiling look higher without raising the roof

They’ve selected some fun, blue-gray tile for the backsplash. Christina observes that it will add visual interest—and the appearance of height—if they extend the tile all the way up the wall to the ceiling, and hang clear glass shelves and cabinets over it. She’s absolutely right on this one. It appears to expand the kitchen, and it’s much more striking.

Flip or Flop
The white counters and the ceiling-high backsplash make this kitchen look bigger.

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Mirrored closet doors do double duty

Every wonder why so many sliding closet doors are covered with mirrors? It’s a decor tactic Tarek and Christina still use today. Not only do they make the room feel bigger, but they reflect light. And one more thing: You get to see what you look like from head to toe once you’re dressed.

Bold floors call for plain cabinets

Tarek says he can design a bathroom just as well as Christina can, so they decide to compete—in this “bathroom war,” each one will design one of the two baths in the house. They agree to use the same plain white cabinets in both rooms, however, because they want to go tile crazy on the floor, and they know that the small rooms would be too busy if they go with colorful cabinets and colorful floors.

Christina picks a bold geometric pattern, and Tarek picks one that is a bit more subtle. Who wins? According to the people who come to the open house, Tarek’s bathroom is better! As if this weren’t shocking enough, his winning move didn’t boil down to tile choice, but built-in storage. Never underestimate the value of how much space you’ve got to stash some extra T.P.

Flip or Flop
Tarek and Christina don’t agree on much.

HGTV

Don’t patch old stucco

The outside of this house is just as big a mess as the inside. The front porch is broken, and the stucco is literally peeling off the walls. Lawrence tells them they can’t patch it, since it will just fall off the walls. They’re going to have to spend another $6,000 on the exterior, to sandblast the old stucco off and apply new stucco everywhere.

Is this season finale house a flip or a flop?

When all is said and done, the project cost a lot more than Tarek expected. They end up spending $95,300 to get the house in order, which is far above the $60,000 that Lawrence originally estimated. With staging and closing costs, they will have to sell the house at $520,000 just to break even!

With comps around $550,000, Tarek decides to go high and list it at $589,900. Christina thinks that it’s overpriced, but this is the one time she hopes to be proven wrong.

They end up accepting an offer of $580,000, which gives them a $60,000 profit—and means they can wrap up Season 7 on a high note. And believe it or not, this couple has even signed on for Season 8, set to air in the spring of 2019! So, it looks like Tarek and Christina aren’t done with each other quite yet.

Flip or Flop
Christina and Tarek are all smiles over a successful flip.

HGTV

The post Did Tarek El Moussa Just Out-Design Christina? A Shocking ‘Flip or Flop’ Season Finale appeared first on Real Estate News & Insights | realtor.com®.

Gotcha! Tarek and Christina El Moussa Uncover What One Sneaky Home Seller Tried to Hide

September 1, 2018

Tarek and Christina El Moussa are savvy house flippers—and the latest “Flip or Flop” episode reveals just how street-smart they are when they figure out what one home seller was desperately hoping to cover up.

In the episode titled “Fantastic Flip,” the two walk into a five-bedroom, two-bath, 1,700-square-foot house in Costa Mesa, CA, listed at $600,000. It looks great, but the one thing that troubles them is that in every room, electric fans have been plugged in and are whirring at top speed.

Hey, what gives?

Tarek fears these fans signal that the house may have water damage from a leak, which the owners are trying to dry up. Upon closer inspection, though, they see that the fans are actually set up to blow out a foul pet odor that permeates the entire home. Nice try, sellers!

Since Tarek and Christina are going to get rid of the carpet and repaint or replace every surface, the pet stink is not a big issue. Nonetheless, it’s the perfect bargaining chip. With some tough negotiation, Tarek gets the house for $30,000 below asking price.

That’s a great deal, but they also have the massive task of bringing this ’70s home into the 21st century and making it appealing to what Christina calls Costa Mesa’s “hipster” buyers. They estimate the renovations will cost around $80,000, and in a market where the comps are around $750,000, the profit margin might be slim.

It also doesn’t help that these former spouses battle endlessly between using fancy materials that Christina swears “buyers will love,” and coming in on budget so, as Tarek argues, they can make a tidy profit. Can they strike the right balance that’ll reel in those hipper-than-thou home buyers?

As they tussle, we get some awfully smart tips about ways to renovate, buy, or sell our own abodes. Here’s what we learned this week:

Fences don’t have to be vertical

flip or flop
Before: a pointy, jail-like fence

HGTV

There’s a brick and pointy steel–pole wall around the front yard, which looks dated and even jail-like. They’d like to demolish the whole thing, but it’s not that simple: The large bricks at the base are supporting the entire front yard. Without them, the yard would crumble into the street. So Tarek cleverly removes the steel poles, and replaces them with horizontal planks of wood, stained to look like redwood. It provides oodles of privacy, and looks very chic. Calling all hipsters!

Flip or Flop
After: Stained-wood planks replace the steel points.

HGTV

How to tell if a wall is load-bearing

Ever wonder, in your effort to create the ubiquitous open floor plan, how to find out if that wall you’re planning to demolish is load-bearing? Contractor Jeff Lawrence shows us that a trip to the attic can be very revealing. From there, you can tell exactly what, if anything, those vertical beams below are supporting.

This time, Christina and Tarek are in luck, as two of the walls they intend to take down are non-load-bearing, and the weight the third supports can be taken care of with a long, sturdy ceiling beam.

Never trust a tiny sample

Since the new kitchen has a relatively standard layout with no unique curves or angles, Tarek and Christina decide to save some cash and order prefab cabinets that can be assembled and hung on site. Christina finds a lovely, dark-gray sample, and they both decide it will look elegant. Unfortunately, when the cabinets arrive and much time and effort have gone into putting them in place, Christina notes that there’s a lot of brown in their dark-gray hue. In fact, brown seems to be the predominant color, a fact she didn’t realize from the small sample. Bummer!

Christina is upset that Tarek didn’t notice it sooner, but Tarek says rather than tearing them down and ordering new ones, they can remedy the situation by using a patterned backsplash that will (hopefully) bring out the cabinets’ gray tones.

“When you buy prestained cabinets, this happens all the time,” he says. “It doesn’t really matter anyway, because the backsplash options that I picked look amazing.”

Flip or Flop
The kitchen with brown/gray cabinets and backsplash

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Chevron patterns are pretty but pricy

While Tarek wants to simply paint the ugly rock fireplace white, Christina says that will look tacky, and suggests covering it with wood-grain porcelain tile in a chevron pattern. Tarek, of course, balks.

“Extra labor! Extra cuts! Extra cost!” he cries.

“Extra beautiful!” she replies.

This time, Christina wins: The chevron pattern is in.

Have too many bedrooms? Stage them as offices or dens

When there are five bedrooms to stage, potential buyers understand that you don’t need to put a bed in each room. Tarek and Christina opt to stage one as an office, and another as a den. All have windows and closets, so they’re official bedrooms, but it’s nice to show that the home you’re selling is versatile. Not everyone has that many kids, or that many guests sleeping over.

So is it a flip or flop?

Although there aren’t any major construction issues, the house is large and Christina’s taste is expensive, so they end up spending $97,000 on the renovation. Even though the comps are around $750,000, Tarek decides to swing for the (horizontal) fences, and lists the home at $829,900.

It eventually proves to be overly ambitious.

“It was a stretch to list it at $829,900,” Tarek admits, “but we eventually sold the house for $815,000.”

In the end, they make a hefty total profit of $113,900, proving that they’ve got what it takes to balance pretty with profits—all without having to hide a thing (take note, home sellers!).

The post Gotcha! Tarek and Christina El Moussa Uncover What One Sneaky Home Seller Tried to Hide appeared first on Real Estate News & Insights | realtor.com®.

Tarek and Christina El Moussa Find a Shocker Under the Floor on ‘Flip or Flop’

August 18, 2018

On “Flip or Flop,” Tarek and Christina El Moussa prove that flipping homes is always full of surprises. However, in the latest episode, they find something truly cool beneath the floorboards.

In the episode titled “What’s Old Is New Again,” they come across what’s listed as a three-bedroom, two-bath home in Hacienda Heights, CA. The home also happens to be in a trust, meaning that the previous owners have passed away and bequeathed the house to their heirs.

What’s more, the house hadn’t been altered since it was built in the ’60s, which is both good and bad. Yes, there are cool retro features, but others that are dilapidated and outdated.

Christina suggests using the old design features, like the wallpaper, for inspiration, and Tarek readily agrees.

“You know what’s weird?” she asks as she steps over the threshold and sees a wall full of fleur-de-lis. “It’s how the looks come back around. Sixty years ago, this wallpaper was in style, and guess what? Sixty years later, it’s kind of come back. I’m just saying it’s kind of cool.”

Flip or Flop
Christina and Tarek El Moussa are back on the same page.

HGTV

She finds some modern wallpaper that reminiscent of the old design, uses it on the same wall, and it ends up being one of the most popular features in the entire home.

“This might be my favorite design ever,” she gushes.

All told, this house flip delivers some fabulous tips that could come in handy in any home or real estate deal. Here’s what we learned.

There’s a big difference between ‘bath’ and ‘half-bath’

Before they make an offer, Christina and Tarek inspect the home and find that the master bath has no tub or shower—so technically, while this home is billed as having two bathrooms, one and a half is more accurate. It will cost them to add a shower, so they use this as a bargaining chip.

There’s more wiggle room in a trust sale

Tarek sees the trust status of this home as a plus: Because you’re working with either a bank or a consortium of heirs, all involved are often eager to wrap things up—and you don’t need to worry about offending the owners with a lowball offer.

This house is asking for $410,000, and Tarek acknowledges it’s in good but dated shape, so he offers $385,000. The trust comes back at $390,000, and Christina and Tarek snap it up. It’s quite the deal for this area.

Sometimes homes contain hidden treasures

When Christina and Tarek are pulling up the (ugly) shag carpet, they find a floor safe in one room. It’s open, and inside they find a pleasant surprise: a box full of old jewelry.

“This is just like my grandma used to have!” exclaims Christina. It doesn’t look valuable, but it most assuredly will have sentimental value for the heirs of the previous homeowners.

“What do we do? Do we return it to the owners or run to Mexico?” Tarek jokes. You can guess which option they pick, and it’s a sweet gesture.

Flip or Flop
Christina and Tarek find a floor safe full of jewelry.

HGTV

A kitchen peninsula is just as good as an island

Most people are dying for a kitchen island, but the peninsula has its virtues, as contractor Jeff Lawrence points out. He’s been instructed to remove the wall between the kitchen and the family room, and there are plenty of sockets and electrical wiring in that particular wall. If they build a peninsula that’s a little like a pony wall, he can simply move down the wiring and the sockets. This is much easier and less expensive than rewiring for an island, and it actually looks great!

Flip or Flop
The kitchen looks fine with a peninsula, rather than an island.

HGTV

The lantern look is back

One bathroom has a wall full of lantern-shaped blue tile, and it’s in such great condition that Tarek and Christina are tempted to keep it. But it wouldn’t really fit with the rest of the house, so Christina finds new, more neutral tile in the same shape, reveling in the fact that what’s old is new again.

Keep those flowering trees!

The foliage around the house is a bit overgrown, but Christina notices a few flowering plumeria and hibiscus trees that are far enough away that they don’t overwhelm the house. She also realizes that the pink, yellow, and red flowers will add cheery pops of color to the pale exterior hues she has planned.

So rather than rip everything out and replace it with all new plants and shrubs, she instructs the landscapers to trim and sculpt the trees, while leaving them in place. The prospective buyers appreciate this.

Ditch the chain-link fence

Whether it’s in the front or the back of a home, an old chain-link fence looks ugly and unwelcoming. They remove it from the front and the vines that have grown over it. Suddenly, the house looks larger and in much better condition.

Bamboo is also back

Christina revives the Tiki trend of the swanky ’60s by devising a backyard garden border of bamboo poles of varying sizes—from 8 inches to a foot long—standing up in a row. It looks fabulous, is cost-effective, and is even sustainable!

Flip or Flop
A bamboo border works well.

HGTV

Is this a flip or flop?

The fate of this project is never really in question. Christina and Tarek are in sync every step of the way, and their passion for it pays off. After all is said and done, they’ll need to get at least $490,000 to break even. Even though the comps in the area are only in the high $400,000s, they list it at $569,000.

After only a few days on the market, the home gets an offer for $560,000, which would amount to a $70,000 profit. That beats a hidden trove of old jewelry any day!

Flip or Flop
All’s well that ends well.

HGTV

The post Tarek and Christina El Moussa Find a Shocker Under the Floor on ‘Flip or Flop’ appeared first on Real Estate News & Insights | realtor.com®.

‘Flip or Flop’: Tarek and Christina Face a ‘Disaster’ That Could Tear Them Apart

August 11, 2018

On “Flip or Flop,” Tarek and Christina El Moussa are used to seeing houses in sad states of disrepair, but the home they flip in the latest episode is a doozy.

“This house is a disaster!” exclaims Christina. “There’s rust coming out of the faucets, burn marks on the walls, the carpets are rotting, even the outside is falling apart.”

In the episode titled “Rock Bottom Flip,” the El Moussas have somehow decided to buy a three-bedroom, two-bath, 1,500-square-foot home in Whittier, CA. Why this place caught their eye is hard to say. The house is filled with junk—as well as dark wood paneling, pink shag carpeting, a stone fireplace, gold-veined mirrors, and other ’70s relics reminiscent of the “Brady Bunch” house (and not in a good way). All of it will absolutely have to go.

The asking price is $450,000, but Tarek knows he’s going to have to negotiate the price down if they want to make a profit, so he begins at $385,000.

“Hopefully they’re not going to be offended,” he says of the sellers.

They’re not—but they don’t accept the lowball offer, either. After a little haggling, they decide to sell the house to Christina and Tarek for $400,000, and the renovation begins.

Contractor Israel Battras estimates it will take upward of $80,000 to get this house in prime condition. Which begs the question: Can Tarek and Christina turn it shiny and new without breaking the bank?

The stress of this flip could easily make tensions mount higher than usual for the pair, who are already on shaky ground due to their divorce. Sure, they’ve agreed to work together as business partners, but might this grueling renovation destroy that relationship, too?

As we watch this flip unfold, Tarek and Christina nonetheless get through it, together—and, in the process, share some great tips for rebooting a house to bring it beautifully into the 21st century. Here are some of the highlights and take-home lessons that might come in handy for your own abode.

Flip or Flop
Christina and Tarek El Moussa tour a horrendous ’70s throwback.

HGTV

Rusty water = galvanized plumbing

When you turn on a faucet (as Christina did) and brown, rusty sludge comes out, you know the plumbing is galvanized, and will probably have to be replaced.

“That’s why people don’t do galvanized plumbing anymore,” explains Battras, estimating that it will likely cost several thousand dollars to replace everything that has rusted through. But it’s an expense that must be borne for clean water.

Turn off the water and electricity before the demo!

Tarek should really know better! Apparently, everyone thought someone else had turned the water off, and while they’re working to demo the kitchen, a giant leak springs up. The workers and the entire kitchen are showered with gross, rusty water—good thing the old cabinets and flooring are all being replaced.

In hot climates, air conditioning is a must

This home has one broken air-conditioning unit hanging off the side of a window, and Tarek and Christina are aware that a house in this part of the state, far from shady canyons or ocean breezes, is pretty much unlivable without AC. Fortunately, a new unit that will work for this relatively small house costs only about $800.

A clever way to refinish the fireplace

That floor-to-ceiling rock fireplace is rather dated, yet a fireplace makes a nice focal point in a room, so Tarek and Christina don’t want to remove it completely. They tear out the rock and replace it with stucco, then place not one, not two, but three mantels on the fireplace, one above the other. Congratulations, Christina, on this unique design move. It really looks great.

Flip or Flop
Tarek tears down the dated rock fireplace.

HGTV

Flip or Flop
The expanded great room with the new fireplace

HGTV

Large tiles can make a small space seem bigger

The two bathrooms in the house are both diminutive, and while Tarek can steal a few feet from adjacent closets and hallways, there’s only so much room to expand. So Tarek opts to use what look like 12-by-18-inch tiles, placing them horizontally for a more expansive look.

Incidentally, rather than springing for marble, he uses faux marble-veined ceramic tile. He says he likes that look even better than real marble, probably because it appears less busy, which is important in a small bathroom.

Satin brass adds pop

Since the home is almost exclusively white and light gray, Christina selects satin brass hardware and fixtures for the kitchen and baths, even though they’re a tad more expensive. She feels they’ve overused the brushed nickel they usually install, and it’s time for some visual variation.

“It will add some bling that will really grab buyers’ attention,” Tarek adds.

When it’s OK to use wall-to-wall carpet

So many designers these days eschew wall-to-wall carpet everywhere in a home, but in a bedroom, where you want noise mitigated and perhaps some cushion for bare feet, it’s still acceptable, according to Tarek and Christina. And the potential buyers seem to agree.

“I like the way it gives it a soft feel,” says one mom as she tours the open house.

How to make a smaller master bedroom look larger

The trick is simple: Stage the bedroom with a smaller bed. A queen, or even a double, will do just fine. And don’t go overboard on the pillows or print bedspread. Solid, light colors work best, and give a more spacious impression.

So is it a flip or flop?

The neighborhood comps are in the mid-$500,000s, but with renovation, staging, and closing costs, Tarek and Christina’s break even point has ballooned to $510,000. Tarek opts to push the list price to $599,900.

Unfortunately, after the house spends a few weeks on the market, they reduce the price to $570,000, and that’s the offer they receive. Their $60,000 profit is less than they’d hoped for, but still not too shabby, given this home’s original shape.

The post ‘Flip or Flop’: Tarek and Christina Face a ‘Disaster’ That Could Tear Them Apart appeared first on Real Estate News & Insights | realtor.com®.

Tarek and Christina El Moussa on ‘Flip or Flop’ Experience Serious Sticker Shock

August 3, 2018

HGTV; realtor.com

“Flip or Flop” stars Tarek and Christina El Moussa may be house-flipping pros, but even they’re shocked on occasion by how high real estate prices have risen. And in the latest episode, you have to wonder: Can they still make a profit?

In the “Midcentury Markup” episode, Tarek calls Christina to let her know about a house in their native Orange County, CA, that he’s heard is ripe for a flip. It has three bedrooms and two baths, measures about 1,250 square feet, and could be had for $525,000.

Christina thinks that’s high for such a small home—until Tarek unloads neighborhood comps on her. Similar homes in that Santa Ana neighborhood are going for $630,000 to $669,900!

“It’s kinda blowing my mind that a 1,300-square-foot house in Santa Ana is selling for $670,000,” she says. “Prices are so high right now!”

A high list price isn’t the only challenge they must face. This house is getting multiple offers, so Tarek and Christina must cough up $540,000 to close the deal. Extra expenses are already mounting!

The good news is that contractor Israel “Izzy” Battras says this midcentury house has great bones, and most of the fixes seem cosmetic and should cost around $65,000 to resolve. However, the yard and empty pool are in poor shape, and may eat up an additional $25,000.

Will this be Tarek and Christina’s first flop of the season? As they scramble to keep their heads above water, they nonetheless deliver some smart real estate advice that could apply to your own life. Watch and learn!

Christina and Tarek El Moussa fear that prices are too high.

HGTV

Beamed ceilings add value

Tarek and Christina were willing to spend a little extra to acquire this house because it has beamed ceilings—which are very popular among fans of Mid-Century Modern style. It’s so much more attractive than the ubiquitous popcorn ceiling treatment that came later, and will cost very little to upgrade. A coat of paint, and they’re good to go.

Bring in experts

It will save you mistakes, delays, and shoddy workmanship if you hire pros. Battras takes care of the interiors on this project, and landscape specialist Jesse Escalera comes in to tame the wild backyard; these pros save Tarek and Christina time and money in the long run.

Be aware of earthquake walls

As usual, Tarek and Christina want to open up the kitchen, but Battras informs them that the wall they intend to remove is not only load-bearing, it’s also an earthquake wall, which is common in California. The earthquake wall bears the weight of the entire house. If Battras were to remove it, he’d have to redistribute the weight to other walls and do a lot of other technical things that would tack $12,000 onto his original estimate.

Flip or Flop
The great room after the earthquake wall was removed

HGTV

Don’t be afraid to haggle

Tarek fears that the extra $12,000 to knock down a wall will blow their budget, but he also fears no one will want this house if it doesn’t have a large, open, new kitchen. So he gives Battras his best puppy-dog eyes and uses other negotiating tactics to get Battras to agree to do the work for $10,500, thanks to their solid work history and relationship. Hey, every little bit helps!

Nix the bathroom carpets

So what’s the one feature no house should have these days? Wall-to-wall carpet—especially dark brown in color, in the bathroom no less. Yuck! Given all that splashes or falls to the floor, the carpet really has to go. Gorgeous, smooth tile makes a huge difference.

Backyard money savers

Since there’s no time to plant grass and laying sod is expensive, Tarek opts for faux turf—which looks great. Escalera also suggests creating a seating area with fire pit and putting gravel underneath it, which is also a budget-friendly surface. In addition, he builds a dramatic spinning cube fire sculpture, which really adds spark to the backyard.

Flip or Flop
Tarek and the spinning fire cube

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Is this a flip or flop?

Tarek and Christina are going to need all the extra spark they can get. When all is said and done, after they put so much extra into the home, they’re going to need an offer of $665,000 just to break even.

Tarek decides to swing for the fences and try to set a new record by putting the home on the market for $699,900, even though that’s above the highest prices that so floored Christina when they started the project.

Unfortunately, “our hope for setting a new standard for comps in the area didn’t pan out,” says Tarek. They had to reduce the price to $675,900, and finally got an offer at that price, leaving them with a paltry $10,000 profit.

“It’s not the biggest gain, but we’re just happy that we didn’t lose money,” he says.

At least there’s that.

The post Tarek and Christina El Moussa on ‘Flip or Flop’ Experience Serious Sticker Shock appeared first on Real Estate News & Insights | realtor.com®.

Exclusive: Tarek El Moussa Opens Up About the Disastrous Mistake He Made Buying His First Home

August 3, 2018

Tips from Tarek el Moussa

Noel Vasquez/Getty Images; pixeldigits/iStock; realtor.com

I’ll never forget the first house I ever bought: I was 21 years old, searching real estate listings for a place in Orange County, CA, for about $400,000. Then, one morning, I found it.

It was the perfect bachelor pad—1,400 square feet, massive master bedroom, man cave all to myself, and coolest of all, a 300-gallon shark tank (may I remind you I was 21 at that time?).

I fell in love. The catch? The asking price was over $800,000.

The seller—who was present during the showing—said, “You should buy this place.” I laughed, thinking there’s no way I’d be able to get a loan for that much, but that if I could, I would.

By the time I was finished with the loan officer later that day, I’d been approved for an $800,000 loan. Somehow, I pulled it off and bought my first home.

And I was very, very broke. With no money for furniture, I ended up living in an empty house for nearly nine months.

That was fifteen years ago, and although I laugh looking back at it now, the experience taught me an important lesson: Buying a home is exciting. So exciting, in fact, that it’s all too easy to get swept up in your emotions and make some mistakes.

So here are some home buying doozies I’ve seen—and made—myself. Check them out and benefit from this hard-won wisdom!

1. Going house shopping before mortgage shopping

When I was just starting out, I worked with a very sweet couple who had just had a baby and who were looking to upgrade. I drove them around town showing them the homes I thought would earn me the biggest check. They told me they had excellent credit, steady jobs, and had set aside a sizable down payment for the purchase. They were excited, I was excited, not a worry in sight.

After seeing roughly 30 homes, they decided on the one. Offer in hand, I called the listing agent. The seller, in his wisdom, came back with a request for the letter of mortgage pre-approval from the bank. My clients had told me that they’d already begun the loan process, so that didn’t ring any alarm bells for me.

But after three days of going back and forth, we discovered that the bank was only willing to lend half of the $550,000 they needed for the loan. Not only did I look like an amateur (which I was), it was a total waste of time for all of us. The couple decided that they would continue renting, and I lost the time and the commission I was so counting on.

If you are serious about buying, be serious about the financing, and get pre-approved for your loan. Having a pre-qualification letter does not carry as much weight. There’s a big difference between what banks say they are willing to lend you and what they actually end up lending.

2. Buying a house beyond your budget

How many times have you gone to the store to buy one thing, but ended up spending more? Same can happen with real estate—and while expensive homes may have everything you want, they’re never worth the trauma of struggling to make monthly mortgage payments. Financial peace of mind is worth its weight in gold. This is why banks cap our borrowing limit—they know the breaking point, even if you don’t.

This is what happened with my first home, but I’ve seen it happen for many others, especially when kids get involved. I once went house shopping with my friends James and Joy. Four homes in, we walked into a great home with a large backyard and a pool. Their son Charlie was so excited about all the fun he’d have inviting his friends over that his parents soon wanted nothing more than to give him those happy childhood memories.

A year in, James and Joy were so stressed by the monthly mortgage payment, they ended up selling at a loss.

3. Gushing about how much you love a home

I once had a client walk into my listing and, from beginning to end, complain about how awful the house was—in front of the owner, no less. I figured I’d never hear from those buyers again; nonetheless, they put in a low offer, and it was accepted, all because this buyer had made the seller painfully aware of all the problems with his property. Talk about the power of suggestion!

But if you truly love a home? Watch out: If you’re at an open house and gush over how perfect the place seems, the listing agent is probably listening in—and will likely advise the seller not to budge on their asking price. Real estate agents are amazingly good at reading emotions and using every bit of that knowledge to negotiate to the last penny.

4. Bypassing a home inspection because the house looks perfect

One time at the start of my career, when I was trying anything and everything, a homeowner called me with a proposition. He had an old home he’d just inherited, and no cash for renovations. He would put up the property, I would put up the cash to renovate, and the profit we would earn when we sold would be split 50/50.

We started … and it was one thing after another. The electric system needed to be totally replaced. The pipes were rusted. Then we found termites. It got to the point where I’d feel nervous whenever my phone rang. When we finally sold, I lost money. I’d been certain it would be a sure thing.

It wasn’t.

Moral of this story? Hire a professional home inspector to carefully examine all the details and bones of the home before you buy. With a home, it’s what’s underneath that counts.

Just remember, building inspectors look for faults: It’s their job. So don’t get upset when you see their 40-page report. Pay attention to the big-ticket items, which include the electric wiring, plumbing, foundation, and things that concern health, like old building materials such as lead and asbestos.

This is why home inspections are a major contingency in most home purchases. One of my clients was so excited about a place, she decided to forgo the inspection contingency on her offer. The good news: Her offer was accepted. The bad: There wound up being an issue with the foundation that cost her an extra $45,000 to fix.

5. Assuming new construction is in great shape

One time, I put an offer on a new house being built in Tustin, CA. Since it was new construction, the buyers didn’t think that an inspection was necessary. I told them it was worth the few hundred dollars, and insisted. We ended up finding that the builder had faulty plumbing … which was found to be the case for the entire newly built neighborhood!

Even with new builds, do your due diligence.

6. Forgetting to ask about HOA/condo fees and assessments

There are a lot of gorgeous gated communities in Orange County, but those gates don’t come free. The expenses of maintaining the community are passed on to the residents in the form of Homeowners Association (HOA) dues. There are even some condo high-rise buildings in Irvine that charge more than $1,200 in maintenance fees per month!

That kind of expense is something worth knowing about way in advance. So make sure to ask about HOA/condo fees, taxes, special insurance, and any assessments on the property.

7. Buying just because you’ve had it with house hunting

It was a late Wednesday afternoon when I was at the office and received a frantic call from a buyer.

“We’ve seen every house on the market, but we’ve got to be out of our home in two weeks because our escrow closes then,” the client explained. In short: “We need a place now.”

No sweeter words to my ears! I showed them three properties, submitted an offer for one on Thursday, and closed within 10 days. They moved in right on schedule … but only then realized how wrong the house was for them. It was an open-concept floor plan that offered zero privacy, a huge problem since their parents were moving in.

It doesn’t matter if your wife is eight months pregnant, you got a new puppy, or you really just can’t stay in your apartment one more day. You cannot make a home purchase just because you are at your wits’ end. Take the dog to the sitter, drop your wife at her mother’s, and think it through. An impulse buy is never a good one, and a purchase out of desperation is even worse.

Follow Tarek on social media @THEREALTAREKELMOUSSA, and if you’re thinking of selling your home, buying a new one, or in need of some renovation, take a look at Tarek and Associates for more information.

The post Exclusive: Tarek El Moussa Opens Up About the Disastrous Mistake He Made Buying His First Home appeared first on Real Estate News & Insights | realtor.com®.

‘Flip or Flop’: Tarek El Moussa Is Still Christina’s Hero—and Here’s Proof

August 3, 2018

“Flip or Flop” stars Tarek and Christina El Moussa might be divorced, but perhaps that’s why it seems all the sweeter to see Tarek play the hero for his ex-wife, when they come across a scary situation in the latest episode of their show.

In “Shattered Flip,” Tarek and Christina try to open the front door of a four-bedroom, two-bath house in Lakewood, CA, that they’re considering purchasing, and find that it has been barricaded shut.

Uh-oh! Could there be a squatter inside? Tarek tells Christina to stay put, in front, while he goes around back to investigate. He finds something even more disturbing in back.

“Don’t come back here!” he shouts, alerting her that the sliding glass door in back has been completely shattered, and that it’s clear that someone has broken in.

What’s not clear is whether or not someone is still inside the house. While Christina waits nervously on the front porch, Tarek checks the house, room by room, to make sure no one is inside waiting for them. Finally, he removes the cabinet someone has strategically placed to block the front door, and opens up to Christina, telling her it’s now safe to go inside.

Flip or Flop
A shattered slider spells trouble.

HGTV

Granted, in reality TV shows like this, one has to wonder if Tarek and Christina might have been clued into this sketchy situation before showing up at the front door. Even so, Tarek still plays the perfect gentleman, and Christina appears to be grateful for it.

All the trouble turns out to be worth their while. Although the house is small (only 1,250 square feet) it has a nice open layout and appears to be in decent shape. Surprisingly enough, whoever broke in and blocked the front door didn’t trash it. If they can get it for under the $460,000 asking price and spend an estimated $70,000 on renovations, they believe they can make a good profit.

As they set about trying to accomplish this, they give us some smart advice on home buying, renovating and beyond—here are some of the highlights.

Ingratiate yourself with the seller

Tarek suggests they board up the sliding glass door while they’re there, to do the owner a solid and to protect their potential investment. Christina agrees, saying “I think they’d definitely appreciate that and maybe accept our offer,” which will be under the asking price.

Use the negatives as a negotiating tool

Although the house is in relatively good condition, Tarek uses the fact that it’s been broken into, and therefore has the potential to be broken into again, as a negotiating tool. In addition, the ceilings are low and covered with popcorn, and the bedrooms are small. Taking all this into consideration, he offers $440,000, and after some negotiation, gets the property for $442,500.

Always wear work boots on demo day

As Tarek inspects contractor Jeff Lawrence’s demo work, a sharp piece of scrap metal pierces the sole of his tennis shoe, and narrowly misses impaling his foot. “Good thing you’re not wearing the flip-flops anymore,” Lawrence teases.

No fiberglass showers!

If you’re living in a place that’s more than three years old, chances are you have a fiberglass shower somewhere in your home. This is an ultimate no-no for Tarek and Christina. The El Moussas replace the fiberglass fixtures with beautiful tile, which adds a sense of luxury.

Flip or Flop
Tarek and Christina select tile for the showers.

HGTV

Replace showers with tubs

The El Moussas also find that one bathroom has a shower but no tub. Unsatisfied, they steal space where they can (in this case, from the closet on the other side of the shower), to make room for a full bath—a high priority for families with young kids.

“I’m so glad we got a tub in here!” Christina says when they’re finished with the project. “I think buyers will definitely appreciate the bathroom more.”

Raise the roof

There’s a lowered ceiling over the kitchen, apparently for no other reason than to distinguish it from the dining/living room area. Once Tarek raises the ceiling to make it even with the rest of the home, the kitchen appears to be much bigger—high ceilings do that.

Spend more on tile for smaller areas

Christina is eyeing some very chic, yet very expensive, designer tile for the kitchen backsplash—at $21 per square foot! Tarek is reluctant to spend the money at first, but when Lawrence tells them there’s only about 30 square feet of backsplash space, Tarek realizes that this is a considerably smaller area than on most projects, and approves the purchase. And we must say it looks great!

Flip or Flop
Stylish backsplash tile is worth the splurge.

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Fix the cracked driveway

There’s no getting around it: If the driveway is cracked, you must fix it, no matter how expensive it will be. After all, it’s usually the first thing buyers see when they approach the house. In this case, the front yard is little more than weeds and cement, and Tarek and Christina must redo most of it anyway. So they create a narrower driveway, and add a foot path and flowers—improving the home’s curb appeal like crazy.

Flip or Flop
The landscaping attracts buyers to Tarek and Christina’s latest flip.

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So is it a flip or a flop?

Due to some unforeseen issues, Tarek and Christina end up pouring $94,300 into the renovation, rather than the $70,000 they were estimating it would cost. Adding in closing costs, they’ll have to sell the home for $555,000 just to break even. With comps in the high $500,000s, that doesn’t leave much room for profit.

So they decide to price it aggressively at $599,900 and see what happens. They do some savvy staging, and after only a week on the market, they get an offer over asking price—$607,000—which they happily accept. That’s close to about $50,000 for their hard work. Combined with Tarek’s display of chivalry toward Christina, this project’s clearly a winner.

The post ‘Flip or Flop’: Tarek El Moussa Is Still Christina’s Hero—and Here’s Proof appeared first on Real Estate News & Insights | realtor.com®.

How Divorce Forced Tarek and Christina El Moussa to Flip Homes in a Whole New Way

August 3, 2018

Flip or Flop

HGTV

After seven seasons of “Flip or Flop,” Tarek and Christina El Moussa have plenty of house-flipping experience. However, in the latest episode we learn that they’re ready to broaden their horizons and take some new risks. The reason? Their divorce.

As Tarek explains in the episode titled “New Normal in Arcadia,” divorce means the couple are now supporting two households on the income they earn buying, renovating, and selling homes. To maximize profits, he says, “we need to step out of our comfort zone.”

So how far out are we talking? A good two-hour drive—which is far enough in real estate terms to present these house flippers with a whole new set of challenges, and lessons for us all.

New neighborhoods require a lot of homework

Tarek and Christina venture to Arcadia, a high-end community where homes are being torn down left and right and replaced with mansions that help boost property values. Although the El Moussas have never worked in Arcadia, they’re up for the challenge because they’ve done their homework on the neighborhood’s real estate.

The home they have their eye on is 1,800 square feet, with three bedrooms and two baths. Comps in the area sell for well over the million-dollar mark. That could mean a big payday for the couple if they play their cards right.

The seller is asking $850,000 for a fixer-upper that will need at least $60,000 worth of work. Add $30,000 in closing costs, and the El Moussas’ profits will quickly dwindle if they can’t talk the seller down. So that’s exactly what they do: They manage to bring the seller down to $825,000, which leaves them wiggle room to make necessary renovations and shoot for a price similar to what other houses in Arcadia are fetching.

Mirrored tile can make a bathroom pop

With the high price they hope to fetch, Christina’s design is going to be key.

“It’s a million-dollar home; it has to be super dialed-in,” she says of the design. That means no detail can be ignored.

But just what those details should be dredges up some tension between this twosome when Christina shows up with two bathroom tile options—one she loves, and one that leaves her feeling “meh.” Tarek immediately goes for the latter—a 3D mirrored tile that he thinks will make the bathroom pop. It ends up working, but Christina can’t help but feel that her ex-husband chose the tile she liked less just to get on her nerves.

Going bold (think pink cabinets) is a big risk

And then there’s the kitchen design. Tarek wants simple, classic white cabinets with a deep blue tile to offset them, while Christina wants to go for something more bold—pink (yes, pink) cabinets. Her take? The bolder you go, the more likely you are to attract a high-end buyer.

Flip or Flop
Christina El Moussa wants to use that pink swatch for the kitchen cabinets.

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Then again, Tarek points out, you might miss the boat entirely if that very specific, pink-cabinet-loving buyer doesn’t show up. With the big price tag they hope to fetch on the property, the decor should be palatable to a wide audience, he argues.

They settle on a classic blue and white, but they decide to make it more interesting by having the cabinets recessed. They also expand the backsplash so it covers a full wall with blue tile to make the entire room feel cohesive.

Bumping up curb appeal is a must

The home’s exterior siding and windows have both seen better days, which hurts the curb appeal. Tarek opts to pull off all of the old siding and stucco the front for a clean look. He also replaces one set of windows with a giant picture window.

Flip or Flop
Before: The house’s old siding and windows have seen better days.

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Then Christina shows up and spends several thousand dollars more in work done to the front of the house. She asks contractors to paint several walls a blue that’s similar to the kitchen tile, and adds stacked stone to the base of the walls. If you’re going to revamp the front of a home to improve your curb appeal, she explains, you have to go all the way. And we have to say, it does make a big difference.

Flip or Flop
After: New windows, siding, and stacked stone vastly improve the curb appeal.

HGTV

Is this a flip or flop?

Renovations and staging end up costing the El Moussas $95,000, but with the money they saved on negotiations and the hard work they put into it, it’s still worth it. They get a cash offer of $1.16 million, netting a profit exceeding $200,000 on this flip.

The post How Divorce Forced Tarek and Christina El Moussa to Flip Homes in a Whole New Way appeared first on Real Estate News & Insights | realtor.com®.

Is Christina El Moussa Leaving ‘Flip or Flop’? The Latest Show May Contain a Big Clue

August 3, 2018

HGTV

“Flip or Flop” isn’t the only show where Christina El Moussa will now strut her stuff. After months of speculation, the word is finally out that she’ll be doing her own solo series, “Christina on the Coast.”

This new eight-episode spinoff, which will showcase El Moussa as she expands her design business throughout Southern California, is set to premiere early next year. Is this her first step toward quitting “Flip or Flop?” It’s possible, especially since it must be hard to work side by side with her ex-husband, Tarek.

Or perhaps she wants to leave behind house flipping and focus on home decor—which makes all the more sense once you see the latest “Flip or Flop,” which shows just how gory flipping can be. In the episode titled “Pigeonhole Flip,” they face quite a debacle together. As they enter a home in Santa Ana, CA, that they’re considering buying, they see that, thanks to holes in the screen doors, pigeons have overrun the place—and not only are the birds flying around, they’re also defecating.

Flip or Flop
Christina and Tarek El Moussa confront a horrible smell.

HGTV

“This place smells like a thousand rotting skunks. There’s pigeons everywhere! I can’t even think straight,” Christina complains. “This is the worst smell I’ve ever smelled in my entire life!”

As she and Tarek struggle to get the three-bedroom, two-bath, 1,527-square-foot house into selling shape, with a $60,000 budget, they teach us plenty of useful tips we can apply to our own abodes. Watch and learn!

Bid low

The sellers are asking $450,000 for the house, but Tarek wants to go in at $420,000, and Christina agrees.

“That gives us room for negotiation,” she explains.

They’re not worried about offending the owner with a lowball offer, or losing it to another buyer—after all, this property has been on the market for a while.

After some back and forth, they get the home for $435,000 and everyone is happy. Except, perhaps, the contractor, Jeff Lawrence, who has to arrange to clean the place and remove that horrible odor.

A small bathroom needs just one door

Oddly enough, both bathrooms are small, and both have two doors. The master bath has a door to the master bedroom and to the kitchen! Perhaps the previous owners had an impaired sense of smell. In any case, Christina says, “by closing off the bathroom door that goes to the kitchen, we’ll gain a lot of extra floor space.” So much so, in fact, that they’re able to put in nice-sized showers instead of the cramped, phone booth–sized ones that had been there.

Flip or Flop
Closing off a door makes a big difference on both sides.

HGTV

A darker countertop adds interest

There’s only so much you can do in a very small bathroom, so although she keeps the rest of this room a creamy white, Christina puts a dark beige tile band around the wall at eye level, and installs a matching countertop on the single sink. This adds a bit of diversion and interest.

Define space with a hanging lamp

As usual, Christina and Tarek have torn down walls to give the home an open floor plan, and Christina brings in a large, square-shaped lamp to hang over the dining table. It helps define the dining space, making the large area feel cozy.

Change the roofline

The home has an unusual storybook facade, with scalloped trim everywhere, and one window with a gabled peak starts above the roofline and slopes almost to the ground—”like an arrow,” says Tarek. These are the first things to go, but then Christina observes that the long roofline makes the house look small and cramped. So she has the workers reduce the size of the overhang. Voila! The house has now gone from storybook to modern.

Flip or Flop
Before: The “Pigeonhole House” with its odd storybook facade

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Flip or Flop
After: The scalloped trim and gabled roof are gone.

HGTV

Add some frosting on the front

Without that dominating roof, the house looks a little blah, so Tarek comes to the design rescue this time. He decks out the porch with a custom pony wall (which goes only halfway up) of frosted plexiglass, and a wooden frame painted to match the trim of the house. They add much-needed style to the facade.

Is it a flip or flop?

That new roofline and a few other unexpected expenses put them $10,000 over their $60,000 reno budget. With closing costs and staging expenses, they figure they’re going to have to get $530,000 for the home just to break even. Comps are around $550,000, but since this house is just like new, Tarek wants to swing for the fences and list it at $599,000. Christina agrees.

The open house is a hit, especially the open floor plan and the light, bright color palette. They end up selling the house for $600,000. The house now smells like success!

The post Is Christina El Moussa Leaving ‘Flip or Flop’? The Latest Show May Contain a Big Clue appeared first on Real Estate News & Insights | realtor.com®.