Remodeling techniques are crucial to master in real estate investing. Here we have laid out the five basic remodeling tips that you must master to be successful. For repair estimation, please see our Rehab Consulting Team information.
An investor who puts into practice these principles will be able to successfully remodel a home, whether by hiring contractors or doing the work himself.
- 1) Economic Value of Repairs
No remodeling job can begin until the value of the job is calculated. We can save you a few calculations. Kitchens & bathrooms almost always need to be upgraded to put a house in “for sale” condition. Clearly the exterior of the home and entryway should give a good first impression. Everything else has diminishing value. Make sure that extra expenditures justify themselves in an increased appraisal or quicker time to sale. Otherwise, you are prettying a house that you might want, but will ultimately be selling it to someone else for less profit because of your tastes.
2) Generate Materials List
We recommend having contractors handle materials. However, understanding the cost of materials will help you determine fair bids. Further, if you want to work on jobs yourself, you need to know your hard costs, so you can evaluate the value of your time versus someone else’s. We do not contend that a materials list is easy to generate. We do contend that generating a materials list will increase your level of success.
3) Order of a Job
Everybody knows to carpet last, right? Some investors make some pretty classic errors on the order of work. Don’t be one of them. Think through the jobs and the steps it will take to complete them. Usually, this means coordinating multiple contractors on the same jobs for weeks. It’s worth it. Having to re-do a job can be very expensive.
4) Pull Permits
Permits must be pulled, it’s the law! If you fail to pull an appropriate permit, inspectors can get nasty. “Tear off that new sheetrock you put up, I want to see the wiring.” And it gets worse. And with a “House for Sale” sign out front, your house will be an inspector magnet.
5) Secure Your Job Site
Theft is real. Do not leave tools lying around. Get alarms on your houses. Make sure your Air Conditioning Units are secured by a cage and an alarm – it is nearly impossible to keep a new A/C on the ground in May and June in some of the more crime-prone areas. Further, clean job sites are more likely to attract buyers.
These principles, put in practice, tend to help remodeling jobs go smoothly.
