Buying, renovating and selling a property is a popular way of making money. However, because so many people have done it and been successful it can look like a really simple thing to do. The reality is there are many obstacles and it can become a costly mistake if not planned properly.
Here are 6 things to consider when taking on a renovation project:
Location
This is key to your success, for example if you find a great family home are there schools nearby? Is the property in a flight path, what are the roads like nearby? Do many people want to live in this area? Make sure you research the area to see how sought after it is, also visit the property at different times of day if possible to see what the area is like.
Buying as low as possible
It is important to have a budget in mind and stick to it when purchasing. It is easy to get caught up when buying a property because s
ometimes there is lots of competition, but it is important to check what properties are actually worth in the area. If you buy too high this eats into your profits before you have begun to even spend on the renovation.
Budget
You should have a budget from the start, which you refer to throughout the process. Keep
track of what your potential sale price should be so that you can calculate your costs and always have an idea of the profit you are aiming for.
Renovation for profit and not for personal taste
Its easy to fall in love with a property and to want to design it to suit your taste, but unless your taste is very generic you may be limiting your market. Consider who your market is, and base your renovation around their needs and budgets. For example if renovating with the view to sell to a family, consider child safety and play areas. A busy professional couple probably wouldn’t want high maintenance e.g. large gardens to maintain. Your decisions should be based on profit not just persoonal taste
Carry out as least work as possible
Closely related to the above point, if you need to move the bathroom or need to turn the area into open plan because the property works best then do so. But when looking at the property consider the minimum amount of works, and if youa re new to renovating, it may be best to find a property that just needs cosmetic changes, such as repainting, plastering etc. Structural changes require planning permission and more investment and can be overwhelming for someone inexperienced in property renovation.
Kitchens and bathrooms
Updating the kitchen and bathroom can add huge value to the property, changing these two areas can give the proeprty a whole new look. To keep costs down consider painting cabinets and counters if they are still in a good condition, rather than changing them as this can save on costs. If you are going to be upgrading these areas do your research, create a budget and stick to it as these areas of the house tend to be the most costly.