A real estate rehabber is someone who purchases property for only one reason. That reason being to fix it up and sell it for a profit. This person has no intentions on living in this property at all. They will usually buy the most beat down and dilapidated properties and fix them up to turn a profit.
Being a real estate rehabber or “house flipper” can be a very lucrative business, but it comes with alot of risk. Although that risk does come with great reward if done correctly. Any body that has a little bit of know how can turn a profit on real estate. You just need to be willing and able to put up lots of money and wait for a return.
When rehabbing houses there are a couple major place that you should put your money. Those places are the kitchen and the bathrooms. These places are going to take most of your budget, but they will also give you the highest returns on your money. The kitchen and bathrooms will make or break a sale.
If a buyer comes in for your open house and is on the fence about the property, the kitchen, if done correctly can sway them to buy the property. They are more likely to live with things that they may or may not like just to get the kitchen of their dreams.
Aside from the kitchen and baths in the house you should make sure that everything else is fresh and updated. This would include any paneling that is on the walls and anything else throughout the house that screams 80’s when you walk through. You can’t have a wave of the future kitchen with paneling or wallpaper on the walls.
You will need to pull out the paneling and hang dry wall, put a fresh coat of paint on the walls, and pay special attention to the floors. The floors are another big selling point when rehabbing a house. Bamboo hardwoods are always nice and can be purchased for around 2 dollars a square foot up to about 4 dollars a square foot. You will definitely get that money back for nice floors on the sale.
You may need to check your budget at this point to see if you can afford to stage your property so the buyers can see the property with a little furniture in it. This will help them so see how their furniture will go. Staging a property is said to speed up the sale by about 30%-40%, so it is always a good idea and well worth the money. You could rent the furniture and do it yourself or you can hire a staging crew to come in and do the work for you.
When you finish up your property on the inside get the outside at least up to par. People will not come in to look at the inside if they don’t like the outside. Get out there and clean up the landscape, cut back overgrown shrubbery and plant new shrubbery, and be sure to dress up the plant beds. If this isn’t your kind of work you can always hire a landscape company to help you out. You can also hire a landscape company just for a consultation on your property to see what they recommend. These guys are professionals so they know what they are talking about.
Now you are ready for your open house. Now you can bring in a Realtor to handle your open house if you are going to list it with them or you can just bring them in to tell you what they think the property is worth. You need to know that much before your open house. It is much harder to sell on your own as opposed to listing it with a Realtor. So if you decide to go that way be prepared for either alot of extra work or a slower sale. When you are walking people through be sure to tell them about all of the upgrades you made just in case they knew the property before hand. That is just to be safe and you know you want to brag about what you did anyway, so don’t hold it back.
There are many different ways to go about rehabbing a house. You really just need to find your comfort zone and stick to it. This job can be done on almost any budget level. So the main thing is just not to hesitate getting started. The sooner you get started the sooner you will be taking you first check to the bank.