by jimmyjack

Created on: December 11, 2007

Real estate investments are not what they were just a few short years ago. What was a thriving market of buying units that needed some TLC, dropping a few thousand dollars on renovations and selling for a huge profit has changed drastically. The unfortunate implosion of the prime rate mortgage has added an unbelievable number of properties to the MLS, which has ultimately driven sale prices well below market value. Investors are just trying to survive at this point. There is now a tremendous opportunity for those with cash looking to capitalize on the down market.

The key is to not make the mistakes of so many amateur investors (self included). The aforementioned real estate boom combined with the surge of many popular home improvement shows and the endless resources at local home improvement superstores gave birth to an ever-growing army of weekend warriors. That is until the well started to dry-up.

My wife and I realized, quite suddenly, the importance of monitoring our out-of-pocket expenses better from start to finish - much, much better. The objective was to think more like the investors who had hypnotized us with their plans that would create "unbelievable returns on investments". Instead of being in awe of their ends, though, we needed to start controlling our means. Primarily, that meant no more complete rehabs or hiring costly contractors which could tie-up a project for months.

There are 5 fixes that, in our experience, can take many properties from rags to a bit closer to riches than if we had dumped a ton of money in them. We learned in what types of property to invest and how to keep the project overhead down. We have a new rule of thumb. First, subtract the estimated cost of repairs from the asking price, and agree to a sale price that we can manage. Then, find a mortgage with a monthly payment that could be covered by a competitive rent if sales were slow. Next, get to work!

1.Paint fixes a lot. Simple, right? It is amazing what you can do with a weekend and some contractor grade paint (assuming the size of your project). Generally it takes us 4 hours to get 2 coats on a 10 x 20 space. Using an edging tool and a thick nap roller can help speed things along. Drop clothes can definitely save some clean-up time (if you are trying to preserve your floors). Taping does take patience and we generally save that for unavoidable mistakes like windows. Buying a satin or an eggshell finish can make the paint job look brighter and more professional. We even

• 1
• 2
• Next Page >>