Home renovations can be an effective way to add value to your investment properties. While some renovations may instantly increase your home’s value, others may not be worth the upfront expense. To help you determine whether or not to pursue a particular remodeling project, we rounded up a few useful tips.
- Take Stock
Assess the magnitude of a project to determine how much work will be required. To do so, you will want to map out every step involved in the execution of the project. If you have a specific timeframe in which you are looking to sell the house, factoring in each step of the renovation will give you a better understanding of the estimated time of completion.
- Tally Up Costs
With so many items and work associated with a home renovation, it is important to budget for the expenses you expect to incur during the project. Build a spreadsheet that includes costs of labor and materials. This will ensure that you don’t overspend and allow you to more accurately ascertain the overall value it will add to the home. If your costs are higher than the estimated value added, the remodel is not worth the investment.
- Cut Expenses Where Possible
Review your financial spreadsheet carefully and determine if there are any parts of the project you can save on. Perhaps you can paint the walls or stain the deck yourself. Just make sure you don’t overestimate your skills, or you risk a sloppy project.
- Get Multiple Quotes
Talk to at least three contractors to learn about the services they provide and their pricing. Often times, a cheaper quote will not always be your best bet. While affordability is a key factor, a strong track record and clear communication are equally important to ensure the service provided meets your expectations.
- Consider the Neighborhood
If you are considering purchasing an investment property to flip and resell, make sure you do extensive research on the projected growth for the area in which the property is located. If the neighborhood is poised for growth, you will have more flexibility with the time spent on the renovation.
Would you like to speak with a member of the RLG team to discuss the value of your current investment property portfolio and determine areas for improvement? Give us a call today! We would love to help you work with the properties you currently have and multiply your investment portfolio.