Rehabbing Properties: Common Traps to Avoid
Rehabbing properties can be rewarding and a lot of fun but it can also be full of pitfalls.
It should go without saying but you always have to anticipate that the costs will come in higher than expected and work will take longer than expected when it comes to rehabbing properties. As long as you are prepared for this you’ll be fine.
Know that there is a big difference between rehabbing properties for profit and redecorating a home to live in. While many projects might may make a home look more appealing and help to attract buyers they may not add anything to the value of your home in real dollars and sense. This is a common misconception too many homeowners still fall into, even with all the TV shows on the topic. Just because you import marble direct from Italy for floors and counter tops, get a great deal on imported furniture from South America or hang expensive art, plant $10,000 trees and put in top of the line appliances you won’t see any difference in your appraised value.
Another important factor to remember when rehabbing properties today is to try not to increase maintenance demands. Most buyers are being more cautious about their spending than ever before and they are also more educated about the additional costs of homeownership than before. This applies to landscaping and planting exotic trees or flowers, putting in swimming pools and more.
Those who are specifically rehabbing properties for profit also often still let their creative design ideas interfere. It can be so tempting to want to try out all types of cool designs and new materials but remember you aren’t going to be living there. You should do a quality job of rehabbing a property but the more personalized or ‘niche’ you make it the more potential buyers you could be alienating.