Renovate Your Property For Investment

September 22, 2011

Tips & Ideas

Renovating a property for investment is a bit different from renovating a property to make it your own home. 

Renovating for investment is a great way of multiplying the returns received from the purchase of a property.

Many investors use this technique for property investment in which they buy a dilapidated place at a low price since there are few takers if any, and then after some amount of renovation, sell it off at a higher profit. This renovating is different since it is purely for commercial reasons and need not be as extensive.

Also since the buyer is only an investor with little knowledge about the loopholes that need to be plugged with renovation, he would like to carry out the bare minimum for renovation which will help him sell it for a decent profit.

Some tips for renovation of this kind include the following:

  • Structural changes can be avoided– when a property is purchased for investment, any renovation carried out needs to be more cosmetic rather than structural. Not only is the investor unfamiliar with the structural flaws if any, it will also require more time, effort and money than what he may be willing to spend.
  • Plan the renovation after checking it minutely– the best renovation can be done by first looking closely at what all needs to be done, and then methodically going about it. This helps in having a streamlined set of operations and continuity without wasting time in renovations beyond the bare minimum.
  • Bathrooms and kitchen are essential-even if nothing else is touched, these two areas must be renovated since these are the ones to be checked closely and since they are water areas, they tend to get worn out faster than other parts of the house. Here too, the essential changes must be made rather than completely replacing everything.
  • Flooring can be changed or scrubbed- Flooring also makes a lasting impression. If it is in good condition, getting it scrubbed should help, or else it may be better to replace it with durable good quality flooring which need not be very expensive.
  • Balance quality and price-whatever the renovation needed, the idea is to balance the quality, appearance and price of all accessories in order to maximize returns from the property investment.
  • Stick to budgets and avoid overcapitalization- while carrying our renovations, cost overruns are usual and overcapitalization easy. But a conscious effort must be made to ensure this is avoided or the investment in property will prove to be a waste.
  • Keep a time frame- renovations can prove to be prolonged exercises, but if  a close rein on time is kept and schedules adhered to, it is possible to make the most of the investment by selling it at the right time when prices are soaring.
  • Make the exteriors impressive- this will help in creating an impact on the first glimpse of the property and all that it entails is repainting the exterior, a bit of tasteful landscaping and an impressive entrance.

An investment property will bring returns only if renovated smartly to create an impact without spending too much on it.

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