Fix And Flip: What To Fix
You bought a house, a house that needs repairs you can make money. What improvements and repairs should be done? First, you need to know before buying, as I explain in another article. Before and after the purchase if you need to have some simple rules to start with the analysis of possible corrections.
ROI
A young couple was very disappointed when I told them that the house was worth $ 110 000. "We just put $ 40,000 into remodeling the kitchen," they said. I looked into the kitchen. She was beautiful. They had added 10 000 dollars in the value of the house by spending $ 40 000. This is a classic example of a bad return on investment.
With fixer-upper, you do things that makes the most "bang for the buck." Aim for a three to one return on improvements. To resurface in the driveway for $ 1000, it is preferable to increase the value of your home by $ 3,000. Even when you're just guessing, keep this formula from three to one in your head if you want to invest in safety.
How to fix a fixer-upper
Things like new curtains, you can not really assess the increase in value. What can be done, even if it is to bring together a number of minor fixes and enhancements that you are considering, and imagine how the house looks like when you're done. Then you can assess whether you have increased the value enough to justify the cost.
It is often the small details that you get the best return on investment, then look at these first. A new mailbox, flowers on the porch, a raked yard and trimmed trees - $ 30 total if you do the work yourself - can make a big difference in first impressions of potential buyers. First impressions are important.
Other small investments that pay big are shiny new switch covers (less than $ 1 each), shelves, a birdhouse, doorknobs, new light fixtures, curtains, new rocks or wood chips on outdoor paths, taps new, new stain on the cover and general cleaning. Standing in front of the house and imagine what it might look like several small improvements (flowers, wood railing, birdbath, etc.).
Big Patches
Obviously, there are things that just need to be repaired. The basic systems must function. Improvements, however, should be submitted to the three-for-one rule. You may have to be creative here. An investor friend of mine once had a wall set up, and for less than $ 1000 created a new bedroom, probably increase the value of the house by $ 8,000. Now that's a good return on investment.
Bathrooms and kitchens are important. A $ 1000 updating of a bathroom can add $ 4,000 worth of a home. Spend $ 2000 wisely in the kitchen (fridge New, re-finish the cupboards, add a garbage disposal, etc.) and you can add $ 8,000 for the purchase price of the house. Looking for changes that are most universally valued (do not paint the kitchen pink because you like the color) and make sure you get a decent return on investment.
Depending on the fixer-upper, there are many potential improvements that could be worth it. These include adding a carport, new doors, fences, gazebos, sheds, painting, carpets, benches, a new cabinet, new toilet, new cooker, an entourage of shower / bath, and trees or shrubs. The bottom line is the bottom line: be sure anything you do not return more than you spend, preferably three times as much.
Pictures/SnapShot :
ROI
A young couple was very disappointed when I told them that the house was worth $ 110 000. "We just put $ 40,000 into remodeling the kitchen," they said. I looked into the kitchen. She was beautiful. They had added 10 000 dollars in the value of the house by spending $ 40 000. This is a classic example of a bad return on investment.
With fixer-upper, you do things that makes the most "bang for the buck." Aim for a three to one return on improvements. To resurface in the driveway for $ 1000, it is preferable to increase the value of your home by $ 3,000. Even when you're just guessing, keep this formula from three to one in your head if you want to invest in safety.
How to fix a fixer-upper
Things like new curtains, you can not really assess the increase in value. What can be done, even if it is to bring together a number of minor fixes and enhancements that you are considering, and imagine how the house looks like when you're done. Then you can assess whether you have increased the value enough to justify the cost.
It is often the small details that you get the best return on investment, then look at these first. A new mailbox, flowers on the porch, a raked yard and trimmed trees - $ 30 total if you do the work yourself - can make a big difference in first impressions of potential buyers. First impressions are important.
Other small investments that pay big are shiny new switch covers (less than $ 1 each), shelves, a birdhouse, doorknobs, new light fixtures, curtains, new rocks or wood chips on outdoor paths, taps new, new stain on the cover and general cleaning. Standing in front of the house and imagine what it might look like several small improvements (flowers, wood railing, birdbath, etc.).
Big Patches
Obviously, there are things that just need to be repaired. The basic systems must function. Improvements, however, should be submitted to the three-for-one rule. You may have to be creative here. An investor friend of mine once had a wall set up, and for less than $ 1000 created a new bedroom, probably increase the value of the house by $ 8,000. Now that's a good return on investment.
Bathrooms and kitchens are important. A $ 1000 updating of a bathroom can add $ 4,000 worth of a home. Spend $ 2000 wisely in the kitchen (fridge New, re-finish the cupboards, add a garbage disposal, etc.) and you can add $ 8,000 for the purchase price of the house. Looking for changes that are most universally valued (do not paint the kitchen pink because you like the color) and make sure you get a decent return on investment.
Depending on the fixer-upper, there are many potential improvements that could be worth it. These include adding a carport, new doors, fences, gazebos, sheds, painting, carpets, benches, a new cabinet, new toilet, new cooker, an entourage of shower / bath, and trees or shrubs. The bottom line is the bottom line: be sure anything you do not return more than you spend, preferably three times as much.
Pictures/SnapShot :
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