"TAREK:" "Flipping houses is a risky business." "Tarek?" "!" "I'm Tarek, and this is my wife, Christina." "This is our worst buy yet." "TAREK:" "We buy the ugliest..." "Wow!" "...the nastiest..." "[ Screams ]" "TAREK:" "...the most rundown houses that we can find." "Oh, my God." "And we transform them into beautiful homes that every buyer dreams of." "We pay for these houses in cash, sometimes sight unseen." "No matter how we look at this house, it's gonna be a risk." "And you never know what you've got until you walk through that door." "Oh, my God!" "What house?" "All it is is windows and wood." "Wouldn't it be cheaper just to bulldoze it?" "The bigger the disaster, the better the makeover." "Dang." "Look at that." "CHRISTINA:" "The bathroom's gorgeous." "Buyers are gonna be obsessed with it." "♪♪" "All right." "That's great news." "Hey, hon." "Thank you." "What's going on?" "So that was the doctor." "Uh-huh." "Got the results back." "Uh-huh." "I'm pregnant." "No way?" "Yes." "For sure?" "Yep." "Honestly, that is the best news we've had in a long time." "I know." "Yes!" "[ Laughs ]" "Love you." "Excited?" "Yeah." "We've wanted another baby for a long time." "And now it's finally happening." "Are you gonna be a big helper?" "Yep." "Taylor's excited to be a big sister." "So while our family is being flipped and before things get too crazy with Christina's pregnancy, we're following up on a call about a house in Whittier." "It looks like it could be a good deal." "♪♪" "Is the project manager meeting us at the house?" "TAREK:" "Yeah." "Frank's gonna meet us there." "What in the world is this?" "It's a for sale by owner listing." "[ Scoffs ] It looks like it's been set on fire, then put out quickly, right?" "Honestly, I have no idea." "And they're asking $245,000." "Ran the comps." "I mean, they're almost at $400,000." "The good news is it has nice windows." "Oh, gosh." "What's " "Look at what -- What's this?" "Wow!" "CHRISTINA:" "What happened here?" "That's plywood." "Oh, my gosh." "[ Ladder rattles ]" "This is actually not bad." "CHRISTINA:" "Huh?" "It's not." "Look at the entrance." "It's pretty nice, actually." "Check out the windows." "So this is probably a big selling feature, you know, when the house was built." "And maybe that went with the look." "You know, it still is a selling feature." "I mean, honestly, this house has a lot of character." "And typically, neighborhoods like this and price ranges like this, you don't have these features." "I mean, you have a lot of lighting." "You have a huge kitchen, big living room." "Yeah, and actually really high ceilings." "Uh-oh." "Why is there no floor in here?" "You think we can keep these cabinets if we get it?" "No!" "It seems like something's wrong with the plumbing, right?" "I hope the house doesn't need a repipe." "CHRISTINA:" "Because why is this all coming out and..." "A repipe could cost like 6 grand." "We could definitely do a lot of really cool things in here." "There's a lot of cabinet space." "TAREK:" "Is this the only bathroom?" "Oh, it's huge!" "It is huge!" "The only bathroom but..." "The layout's weird." "Yeah, it's really weird." "Uh-oh." "I feel like the shower..." "Should have been back there." "It'll cost about 4 grand to reconfigure the plumbing." "It has a dual-pane window." "Which means if we bought the house, we could easily fix that." "There's only two good things -- the window and the size." "That's about it." "This, I think, must be the master." "Maybe." "There is no master here." "CHRISTINA:" "Yeah, all three bedrooms are really small." "It's definitely unfortunate that there is no master bedroom." "Look at this!" "It's so weird." "Yeah, I don't get that." "This house doesn't bother me so far." "I actually see a lot of potential." "I think the floor plan is amazing." "It definitely has potential, but there's, like, so many weird things going on here." "I have no idea what any of this costs." "Yeah, I noticed there's no AC here, either." "Again, a plywood patio cover." "Yeah." "This yard is a jungle." "I feel like this thing might have to come down." "This would absolutely have to come down." "[ Sighs ] I mean -- This window is really nice." "And actually, this is making it really dark." "But if this was gone, this would provide so much natural light." "Yeah, it would look really good." "Can we keep it?" "Hopefully." "What's up, Frank?" "Hi, guys." "Hi." "What do you think about this place?" "Rough shape." "Yeah." "It's weird because the outside looks, like, really scary, but the inside's not too bad." "Something's going on around all the windows inside, which you'll see." "I thought you said the inside was really good." "It's not as bad as the outside, but it's not good." "Okay, I'll take a look and let you know." "♪♪" "Despite the red flags here, we love the potential of this house." "As always, it's just a matter of figuring out how much we'll need to spend before we decide whether to move forward." "You're looking at about $55,000." "CHRISTINA:" "That's not that bad." "All right, I think we need to jump on it and make an offer." "All right." "So Frank said the rehab's going to be $55,000." "Comps, they're almost at $400,000." "So I think we should do it." "What if we came in a little bit lower, like, $240,000?" "They're asking $245,000, so I think it's close enough to where they would accept it." "Want me to call 'em?" "Yeah." "I just feel like this house for most people has so many red flags that I don't feel like they're gonna have multiple offers." "Well, let's find out." "[ Cellphone ringing ]" "Hey, Ben." "How you doing?" "My name is Tarek." "My wife, Christina and I are at your for-sale-by-owner property." "We spoke earlier, today." "The one in Whittier." "We're thinking about offering 240,000 and wrapping up the property today." "And it would be all cash." "Okay, sounds good." "♪♪" "There turned out to be a lot of interest in this house from other investors." "But we ultimately agreed to a purchase price of $250,000," "$5,000 above the asking price." "It's a big project." "But if we can stay on budget and on time, the potential is there for a big reward." "CHRISTINA:" "Ah." "TAREK:" "Not bad." "So, back here, all we're gonna do, take down the patio cover, clean up the backyard, run irrigation, and put grass in." "I do have some really bad news for you, though." "What do you mean, "bad news"?" "I know we love the windows." "Uh-oh." "The new windows." "All right." "And we got really lucky they were all new windows." "Yeah." "But when they put them in, they didn't put them in to code." "Okay, so we just fix them." "So they don't meet the height." "Oh, no." "What do you mean, "height"?" "So you have to be 44 inches to be able to get out the window in case there's something that happens inside." "Oh, so they need to be lowered for egress in case of an emergency." "So we're gonna have to break a lot of stucco." "We're gonna have to pull the windows out, re-frame everything." "Bad news, Frank." "That's really bad news." "♪♪" "TAREK:" "It's an exciting time for us." "We're expecting a second child." "And our house flipping business is in full swing." "But at our newest project in Whittier, California, that we bought for $250,000, our project manager has just delivered some bad news." "I know we love the windows." "Yeah." "But when they put them in, they didn't put them in to code." "So we're gonna have to break a lot of stucco." "We're gonna have to pull the windows out, re-frame everything." "Redoing the windows on this whole house could be, like, 10 grand." "[ Scoffs ]" "It a lot of work." "Wow!" "I knew the windows were too good to be true." "♪♪" "TAREK:" "While we were re-framing the windows, we discovered that the stucco was beyond repair." "So it all has to be removed." "And on top of everything else, they discovered major termite damage." "♪♪" "When they said re-plaster the house..." "Oh, my God." "What house?" "All it is is windows and wood." "Looks like we're rebuilding a house, not remodeling a house." "Look at this." "I feel like in these cases," "Wouldn't it be cheaper just to bulldoze it?" "You're smiling." "Yeah." "Because of the way the windows were previously, the stucco wasn't finished." "Who knows how long it was like that." "All the paper in the wall was deteriorated." "We would have had to take it out anyways." "This is crazy." "TAREK:" "We're over 25 days into this house, and we're still standing in open framing." "We haven't even done any design work yet." "This is really frustrating." "We took the patio cover down." "It's getting a lot of natural light." "It's actually very bright." "Yeah, can I bring something up?" "Sure." "Now that the patio cover's gone, you get a lot of heat in here." "So, you know, it looks better." "But without A.C., it's gonna be really hot." "Okay, so, is the existing furnace functional?" "PEREZ:" "No, that's being replaced." "So, how much more to add an A.C. unit when we replace the heater?" "Is it about 3 grand?" "Yeah." "Pfft." "I think 3,000 buyers would pay, for sure." "We would." "Okay, let's do it." "All right." "Let's get out of here." "♪♪" "Kitchen, um..." "Wow." "Look how big this kitchen is." "The layout's gonna be important." "So, right now, you have a huge entry here." "Because this area right here is so large, it just lends itself to an island or a peninsula." "It could go either way." "I think run a peninsula corner to corner because there would be so much cabinetry." "You'd have a lot of counter space." "And then the entry is right here." "But it won't be closed off, because all this will be open." "I think all buyers would like that." "All right." "So we have a game plan, then." "Yeah." "It's gonna look nice." "♪♪" "[ Cellphone ringing ]" "[ Sighs ]" "[ Chuckles ]" "Wow." "Um... ♪♪" "TAREK:" "We're over two months into this flip in Whittier, California that we bought for $250,000." "And the finish line is nowhere in sight." "This house has been a total disaster." "And our renovation has barely stuttered forward." "The latest problem -- our contractor, Frank, tells us we have asbestos in the heating and air ducts." "TAREK:" "The what?" "Yeah, the ducts here are wrapped with asbestos." "[ Sighs ]" "Asbestos, that's a terrible word." "Do you know how much that's gonna run to get rid of?" "Okay, so, when can they start?" "All right, sounds good, man." "There's nothing we can do." "This house is a certified disaster." "But we need to push forward and work on getting it finished." "In addition to removing all the asbestos and upgrading the home with central air, we're reconfiguring the bathroom, adding a full-size laundry room off the kitchen and updating the plumbing and electric." "♪♪" "All right." "[ Chuckles ]" "It's starting to look like a house." "I mean, we've been working here for a long time, but it's coming together." "We got new ducting, new A.C., new heat, all new drywall." "We had to redo the stucco on the outside." "So we've actually spent a fortune, here, just to put the foundation of the house back together." "This is definitely one of the biggest projects we've ever encountered." "We've made a lot of progress." "Now, we're back to like at the point where we normally are when we buy a house." "Yeah." "All right, so, we made some really big changes in here." "I hope I like them." "[ Gasps ]" "Looks so good." "Do you remember what it was before?" "Yeah, the tub was right here, which was, like, the weirdest thing ever." "So it makes so much more sense to have the tub and the shower right there." "Right." "I feel like this house is just all about, like, putting things back together to make them normal." "Right." "So, now that we have the layout, we need to figure out the design." "You said you went shopping, right?" "Yes." "I have materials in the kitchen." "Okay, I'm super-excited about this design." "All right." "Question." "Is this for a bathroom or kitchen?" "It's both." "So, okay." "I saw this tile." "I absolutely fell in love with it." "Is it expensive?" "It is, but I could not be more obsessed." "So I basically designed everything around this." "So what I was thinking, instead of using this for the entire backsplash and the entire shower, we could save money but still have high design." "For example, like, right here is where the microwave and the oven are gonna go." "Right." "So instead of doing that as the whole backsplash, which I kind of feel like is too busy anyways, all we do -- frame it out and just add it there." "Okay, so just an accent piece behind the stove." "Exactly." "So if this is the accent piece, what's everything else gonna be, then?" "Just really simple white subway." "Okay, so white subway, accent piece behind the stove." "Right." "I love that idea." "What are you thinking for bathrooms?" "Well, again, since I just love this, there's only one bathroom," "I think we just frame it out, do a big picture of this, as well." "This for the bathroom floors." "Which laminate?" "The gray, for sure." "So design is done." "I'm gonna give Frank the information." "He'll order, and we'll be rocking and rolling." "♪♪" "It's looking good, man." "Christina's gonna love this." "Dang!" "Look at that!" "Pretty, right?" "You did a good job." "This is awesome." "I love the colors." "You know what?" "This really pops." "There only one bathroom, but it's super high design, so everyone's gonna love it." "♪♪" "TAREK:" "While we're finishing up with the kitchen and bathroom, we're also moving forward with the painting and landscaping." "The house is getting a gray color with white trim." "While in the front yard, we're doing a drought-tolerant desert design." "And in the back, we're laying a combination of mulch and sod, which is geared towards kids and pets." "What is that?" "Well, we made a mistake." "How?" "We didn't take into consideration that the stoves that we buy have a tall back." "Yeah, but we've bought a stove before that had a low back." "It was supposed to be at least another foot bigger." "Yeah, we missed it." "We didn't communicate right, and this is what we got." "No, no, no." "Come on." "We talked about the fact that we were having this be, you know, substantial." "This is dumb." "This shouldn't even be here." "It looks like there's something missing." "I think it looks nice." "I think once the stove is in " "You got to remember the back's gonna come up here and the microwave comes down." "So it's gonna be a nice focal point." "I totally know what it's gonna look like." "It should have had the stove that didn't have the back." "Okay, but once it's grouted, you're gonna have a nice microwave, so I think it will be fine." "No, I think it looks absolutely horrible." "[ Screams ] Oh, my God!" "Check out our exclusive online videos for more "Flip or Flop"" "reno ideas." "It looks so nice." "Wow!" "Look at this." "Right?" "And you'll also get a behind-the-scenes glimpse into our nutty, little fast-paced world." "♪♪" "TAREK:" "After a long and expensive renovation, we're almost finished with this house in Whittier, California." "But Christina is upset because the tile accent in the kitchen has turned out much smaller than she had planned." "Well, someone should have realized that, obviously, we would never be okay with it looking like that." "TAREK:" "We didn't take into consideration that the stoves that we buy have a tall back." "Yeah, but we've bought a stove before that had a low back." "It was supposed to be at least another foot bigger." "It's really disappointing because this was what" "I was really excited about for the kitchen." "It looks so plain in here, now." "So, what do you want to do?" "I want to rip it out and start over and buy the appropriate stove." "If we decide to do that, seriously, it's gonna be like $1,000." "For what?" "To have a beautiful kitchen." "Is it gonna change out sales price?" "I think so." "All right." "You want to rip it out..." "We'll rip it out." "All right." "Thank you." "It's hard for me to justify spending $1,000 to correct this little mistake." "But ultimately, I think Christina's right, that the larger showpiece tile will help us sell this house." "♪♪" "This is so beautiful." "It looks gorgeous." "Tay Tay, before this was really small, and Daddy wanted to leave it, but then Mommy made him make it bigger." "Do you like it?" "Yeah." "You like this kitchen, Tay?" "What's your favorite part?" "Everything." "TAREK:" "You want to know how much money we spent here?" "$500,000?" "Close." "We paid $250,000 for the house." "Spent a lot of money here, baby." "Yeah, after staging, our rehab total is gonna be about $95,000." "That's insane." "We're gonna have, like, $20,000 in closing costs." "We have a break-even of $365,000." "Well, the real question is, what are the comps?" "I did find one comp." "Just closed." "It's, like, three or four blocks away, a little nicer of an area, though." "It sold for $470,000." "Is it fixed up?" "It was a flip." "Brand new turnkey." "Four-bedroom, two full bath." "Oh." "A little bit larger." "Well, that's not a very good comp." "We have one bathroom." "Here's my thought." "I think we just come in and list it at $469,900." "So you want to come in as high as a comp that's four bedrooms and two baths?" "That comp is gone, which means we're the newest, nicest house on the market." "I do believe at the list price of $469,000, we will get offers because the house is spectacular." "That would be amazing." "It would be a good flip." "Ah!" "Now, we just need to get the house staged, get some photos, get on the market." "Yeah?" "Almost there." "♪♪" "The house looks really pretty." "You know what, I've never done a rock landscape before." "It looks awesome." "It totally works." "I'm just gonna put one more right here." "I like how we framed the flowers right here to the entrance." "It gives it a nice little walkway." "It looks gorgeous." "TAREK:" "Wow." "That is open." "Look at that." "Home, sweet home." "This looks unreal." "It's a beautiful house." "So the kitchen looks amazing." "I'm really glad we went this this huge peninsula, absolutely obsessed with it." "Kitchens and baths sell houses so let's go look at our only bathroom." "Oh, la, la." "This bathroom is gorgeous." "Buyers are gonna be obsessed with it." "All right, you ready to get started, or what?" "Yeah." "Let's get ready for the open house." "♪♪" "Oh, wow!" "Look at the flooring." "WOMAN:" "Oh, the flooring." "I love the floor." "Hi." "Come on in." "Hi." "How you doing?" "Good." "Yeah, so I'll tell you a little bit about the house." "Three-bedroom, one bath, completely remodeled." "And we just put it on the market today for $469,900." "I'd love for you guys to take a look around and let us know what you think about the design and the price." "Lots of light in the place." "Look at their kitchen." "WOMAN:" "Oh, this, I like." "Isn't that beautiful?" "Oh, nice." "I love the grass back here." "The yard is a lot bigger than I thought." "His-and-her vanities." "Yeah." "WOMAN:" "It has the same backsplash as the kitchen." "That is really neat." "Oh, I thought we we're gonna find the master suite but..." "It seems like they're all the same size and there's just the one bathroom." "So, what did you ladies think?" "Nice and spacious." "Love the colors." "Does a three-bedroom, one-bath work for you and your family?" "WOMAN:" "Well, you know, it's something to consider." "Definitely put on the list, so..." "And what do you feel about the list price of $469,000?" "It's very competitive, and I see that you've done a lot, and I like the low maintenance for the front yard and stuff, so..." "Well, thank you for coming by." "And if you guys have any questions, just give us a call." "Bye-bye." "Bye." "Bye." "♪♪" "TAREK:" "This house is great." "Definitely love the house." "Obsessed with the designed." "How do you feel the day went?" "I think the day went well." "I mean, we had good activity." "Everybody loved the design." "My only concern is that nobody really talked about offers, so..." "Well, only time will tell." "First open house." "First day on the market." "You know, let's give it some time." "But either way, We'll make some money here." "We paid a good price." "Exactly." "No matter what, it's not gonna be a flop." "♪♪" "TAREK:" "After just 10 days on the market, we received three offers." "And we ended up coming to terms with a buyer for $470,500, just above our asking price." "We're set to close soon." "And if this deal goes through, we'll make a profit of over $105,000." "We better find another house to flip quick before the baby comes."