by Helium01

Created on: March 06, 2009

How to Renovate a House for Profit

When housing prices are in a slump it can be tempting to think that the smart thing to do is to stay away from real estate. In effect, during times of economic downturn, the best deals on homes can be found. Rather than buying when the market is high and there are many potential buyers interested in the market, buying during a housing crisis can mean great deals and little competition.

Although it is true that it can be difficult to flip a house for profit in a declining market, there are always ways to make it work. If you buy a house when prices are low and everyone is selling, you are guaranteed to get a good deal, however you may have trouble selling your home after a quick set of renovations, since the market will still be low.

In this case, factor in the monthly cost of carrying the home, along with the renovation costs, and decide whether you could rent out the dwelling and cover your costs. If the answer is yes, you may have yourself a winner. Down the road, when prices recover you can choose to sell for a profit, or continue renting for regular monthly income.

When money is tight, it can be hard to know which renovations to focus on to bring the most bang for your buck. Here are a few that should be at the top of your list.

Major Flaws

If the house has any major flaws, these need to be identified early and fixed if possible. Ideally, you will not be purchasing a home that needs a major overhaul as these costs can be hard to recoup. However, if you purchased the home knowing that there was something major that needed to be changed or repaired, this is an absolute must-do in terms of your renovation project.

Kitchens and Baths

It can get a little old if you watch the home renovation shows on television, however the old adage is true: kitchens and baths are what sell homes. If you are going to spend a little bit more money in any area of the home, make sure it is in these rooms.

Paint

One of the most inexpensive renovations that you can undertake is to repaint the entire interior of a home. On a related note, when looking for a home to purchase, the one with Pepto-Bismol colored pink walls but a solid structure and good neighborhood is the one you are looking for. Most buyers will be turned off, but you can see the home without the pink walls and know that it is a winner.

Curb Appeal

Another top-of-the-list renovation is anything to do with curb appeal. You can't sell a house if
no one will walk through the front door. Don't spend an arm and a leg on landscaping, but make sure that the front of the home is inviting and neatly kept.

These are just a few tips to get you started thinking about ways to renovate a home for profit. If you decide to undertake a project of this sort, know that it will be a lot of fun but also hard work. However, when you enjoy what you are doing, the hard work can itself seem like a lot of fun!

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