Whether you are improving the home for yourself or as an investment, rehabbing a property shouldn’t be done without some preparation. In our latest post, we will discuss 5 common rehab mistakes to avoid before you begin the demolition.
Buying a property that needs some work can be an excellent way to find a house at a great price. People buy houses like this for themselves and as lucrative real estate investments. Flipping homes for profit is still a popular choice for many investors. It can be a great way to generate extra income relatively quickly, but you should definitely know what you are doing. Keep reading to learn about some of the common mistakes buyers make and how you can avoid them!
Mistake #1: Thinking The Property Will Be Worth More Than It Actually Is
People often assume they are going to get the highest price possible when all is said and done. However, that isn’t realistic. Just because a property in the area sold for a certain amount, doesn’t mean yours will too. In fact, if you are looking to resell the house quickly, you will want to price it to sell. That often means pricing it slightly lower than the other houses that are currently listed. Never assume you will get the high end of the spectrum when flipping a house in the Philadelphia area.
Mistake #2: Underestimating Your Costs
Rehabbing a house can become expensive if you haven’t priced things accurately. You will also likely have expenses come up that you hadn’t planned for. Knowing this ahead of time will allow you to pad your budget and plan ahead for the unknown. One of the worst mistakes you can make is to find yourself out of cash with work still left to do. You will either be forced to sell it as is (likely to another investor who can finish the job) or hold onto it until you have the cash to finish the work yourself. Either way, you will be missing out on some potentially big profits.
Mistake #3: Making Repairs On Your Own That Are Out Of Your League
Just because you have seen them do it on HGTV, doesn’t necessarily mean you should do it all yourself. Of course, there are projects that you will be able to tackle, but be realistic about your skillset. For example, don’t attempt to put in a new bathroom all on your own unless you have some serious plumbing and carpentry experience. Hire a pro when needed so you don’t find yourself spending even more money on your mistakes.
Mistake #4: Not Having A Way Out
Things may not always go as planned. A wall you had planned to knock down may turn out to be load bearing. Or maybe you aren’t able to flip it as quickly as you need to. It is important to be flexible and roll with the punches. Consider renting it out if you aren’t able to sell right away. Or maybe scarp a renovation that is going to end up breaking the bank. Keep our options and your mind open as things will not always go according to plan.
Mistake #5: Doing Too Much
If you are flipping the house, remember that it is never going to be your home. Don’t spend too much time making things exactly as you would want. Many investors will sink too much money into the house, without having justified returns. Make the house livable, desirable, and ready to move in, but don’t feel the need to go all out. Your new buyers will likely want to add things according to their taste anyway.
If you want to buy a house to rehab in Philadelphia, come directly to the source! When you choose to buy from Philly RE Holdings, you will know exactly what you are getting without having to wonder about additional problems that might arise.