There is a renovated townhouse in a subdivision that isn't that great. Most of the townhomes were built in the late 1960s, and are a bit run down. It's mostly below middle class people living in this community.
Let's say the average townhome price in the subdivision is 200k. But there is a flip selling as well, someone bought it at a low price, renovated it from top to bottom, new floors, new kitchen, new appliances, painted walls, new carpet, new AC unit, new roof etc. and is selling for 240k.
Is it reasonable to assume you won't get much appreciation out of it? In 5+ years time – all of those renovations will be old and dated. The house won't have that new house appeal unless you sink more money into renovations.
Let's say in 5+ years time the townhomes in that community sell for 225k. Well if we paid 240k 5 years ago, it's safe to assume we can't sell it for 260k+?
or do the renovations of today keep their value in the future?
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