Working on a house to rehabilitate is definitely one of the more capital-intensive and labor-intensive investments you can venture into. You’re going to need to make this project worth your time and money so that you can stay motivated to see it through, no matter how long it takes. This way, you’ll be able to make sure that you can sustain yourself while you work on the house.
Here are a few steps you can take to maximize profit when you’re flipping a home:
1. Do Your Own Demo
When the house you’re working on needs a major renovation, you might have to demolish some parts before getting the builders in. Doing the demolition by yourself will remove the step of finding someone to do it for you. This will reduce the initial labor costs you’ll have to face.
Before you start smashing walls in, prepare to wear protective gear. Ensuring your safety and everyone involved in the project will make it unlikely that you’ll have a lengthy medical bill to consider at the end of the build. Wearing a face mask, goggles, and gloves should be enough to protect yourself from flying glass, mold, and any potential splinters.
2. Be Your Own Agent
Considering how you’ll need to make the most of a low-margin project, doing a lot of the work yourself can help widen those margins. If you’re buying and selling the houses, you can have a chance at getting 100% of the commission that every sale and purchase will bring. That’s an advantage of becoming an online real estate broker. You’ll have the backing of an existing company remotely, as well as know-how in entering the industry and even earning your license in the process.
Becoming your own agent will allow you to negotiate better prices and prepare budgets for rehabilitation that can match the profit you’re looking for. That’s because you’ll be able to know, at a glance, the value of the property. You’ll be providing yourself the insider information while earning extra income as a real estate agent — be it through your personal projects or simply by selling other people’s homes for them or being an agent for hire. You can also set aside a portion of this income as capital for your future ventures.
3. Get The House Inspected
Hiring a professional experienced with pests, mold, or any other forms of biohazards that can thrive in abandoned homes before you start a flip will make sure that you and your team will stay safe during the build. It’s an expense that can reduce the chances of you receiving a medical bill or being sued. This is one of the other expenses you need to prepare for before a build.
Inspecting a home for the first time will require you to wear protective gear that depends on the state of the property. If you know that people haven’t been in that home for years, you should equip yourself with a mask, goggles, and coveralls just in case there are any fleas around. At the same time, coming prepared will make it less likely that you’ll fall sick from inhaling mold.
When you finally sell the house, informing potential buyers of the investments you’ve made during the rehabilitation can help increase its value. Before they even turn the key to their new home, you would’ve done most of the work for them. The new homeowners will be able to sleep soundly at night, knowing that they’ll be safe from any inside threats.
4. Practically Free Staging Furniture
Consider staging the homes using furniture from your own home or furniture that you can find in antique stores that shop owners are willing to give away so that they can make room for other products. You can also look into forfeited storage units that contain furniture. It may sound drab, and you might feel discouraged to give this idea a shot. But you’ll never know what you’ll find.
You can also try negotiating with local furniture shops. Ask them to lend you their furniture so that you can put it on display in the home you’ve rehabilitated. This will provide a chance for their product to be showcased in an environment that makes both more desirable. The product will make the home look more comfortable, and the home will make the piece of furniture appear as if it were made for the room they’re staging.
If you lack time to do a surmountable number of house flips, take some of these steps into account when you’re working on that next project. All the hard work you’re putting in will be a lot sweeter when more money enters your bank later on.