How To Buy A Renovation Property
If you’re looking to expand your property portfolio by buying a property that needs renovation, then you’ll know this can be a nerve-wracking strategy. However, the rewards can be valuable. You need a lot of confidence to take on a project like this. It will be stressful, but you can end up with something really great. Here are some top tips to turn a renovation project into an investment.
Think About Your Budget
The first step must be working out what you can afford to do. Remember that with a renovation project, there are almost always some unexpected costs, whether that’s finding an unexpected damp problem, or bad weather causing delays. There are nearly always unforeseen costs, so you can’t stick entirely to your budget. Leave yourself some room for this. Work out your budget, then add 20%.
Some of the priciest repairs can be fixing damp, missing roof tiles, plumbing, and rotten window frames. There might be costs outside too, such as hiring Sydney Tree Company to remove trees causing a problem with foundations.
When going to look at a potential renovation project, ask your builder or building surveyor to come with you so they can give you an idea of the costs of renovation.
You can use the details you learn from this walk-through to make a decision on whether or not to buy the property.
Making An Offer
If you’re confident that you can afford the property, you need to decide whether or not you’re going to go ahead. There are some factors to consider.
- Don’t underestimate the hard work involved. Renovations are tough and tiring, so be certain that you can handle it.
- Don’t underestimate the costs. Go over the numbers more than once so you’re certain your finances are right.
- Go with your gut. If you like the house, you like the area, and you have a good idea of what you’re going to do with the project, then trust your gut instinct.
- Don’t be reckless. Think with both your head and your heart when deciding what to buy.
Identify The Work That Will Make A Real Difference
Don’t try to do everything all at once. Doing this will only overwhelm you, and it will make a big dent in your budget. A savvy real estate investor will maximize their financial rewards at minimum costs. This is the best way to capitalize on your investment property without spending too much. Identify the main renovations that will make the biggest difference in the property and prioritize getting these done first, so you increase the value of your investment.
Find The Wow Factor
Identify what work will make your investment property stand out, so you can make sure that you add a wow factor to make the property appealing and exciting. This will allow you to set your own price.
Think about which renovations will give the highest return on investment. This could be a new countertop in the kitchen, new flooring, or a new bathroom.