So you want to invest in Real Estate and Rehab a home?
- The most important consideration in rehabbing a home is also one of the top three most important things whenever you buy any property. You guessed it... "Location, Location, Location".
- Location is a relative term and is in some respect a subjective decision. From the perspective of investing/rehabbing, you might consider location to be primarily relative to price. If you find a property that is otherwise similar to neighboring properties that are considerably higher in price than that is probably a good location! Don't just go by list price; go by recent sold prices! This can be a good gauge of value, but you have to also make sure the subject property doesn't have a latent defect that will affect its value.
- Is it next to an apartment building, commercial property or some other potentially less desirable property?
- Is it a corner lot with no yard when the house seems to be a good home for families with small children?
- The home itself
- Is the home a good size, or can it be expanded?
- What can you do that will greatly improve the value of the home? You want to improve not only what is there, but to add some tangible feature(s) as well. This is particularly important when you are planning on 'flipping' the home in a short period of time.
- Is there a logical way to add a bedroom or bathroom? Maybe add a porch or a deck?
- Can you finish a basement or attic?
- It's fine to combine two small rooms, but give it some thought if it reduces the marketability of the home. For instance, if a three bedroom house has small bedrooms, don't just combine two bedrooms without adding another somehow because your three bedroom house just became a two bedroom house.
- How is the curb appeal? Can you significantly improve the visual appeal of the home? You'd be amazed at what paint can do, but it may also take a creative eye. Landscaping can make a huge difference too.
- Most good investors make their money on the 'buy' side, not on the 'sell' side. Don't get too emotionally attached to a particular property and set limits to what you would be willing to pay.
- more to come... (Call me at 630-577-7455).