Want to Rehab some Houses this year?

Rehabbing houses has been made incredibly popular by reality TV shows. Those T.V. shows make it look so easy appearing highly profitable, lots of fun, and a more rewarding experience than sitting in a cubicle working 40 hours a week paycheck to paycheck .

But do those shows often share what are the potential pitfalls, most important aspects to get right, and how much can you really make?

The Profits and Perils of Rehabbing Houses

It would be irresponsible to hype up the great money to be made from rehabbing houses without being transparent about some of the potential pitfalls too. I recently read an article from Bloomberg News that epitomizes the real estate investment landscape. This report highlighted how some real estate investors are doubling their money on million dollar NYC condos. But they are taking more than a year to complete these projects.

In most marketplaces in America you have the potential to make five, six, or seven figures fixing and flipping houses, or simply by sitting on them for years in a appreciating market. In other places investors are flipping houses in days, or are leasing them for positive net cash flow each month. How much you make, and how fast you start making a profit is all about how prepared you are, your knowledge base, mentorship, team, and working smart not hard.

Start with Your Exit Strategy in Mind

The best way to succeed in the rehabbing houses niche for big profits is to know your exit before you start the project. Are you planning to fix and flip houses to retail buyers, fix and rent houses or both? This will help you determine several deciding factors.

When it comes to investing in real estate investors need to set projected outcomes in advance. And it’s even better when they have multiple exit strategies. Knowing your numbers and sticking to sound principles not speculating can make a big difference too.

Knowing how much will it really rent for. And how fast can you really rent or resell the property. How much will the property really be worth once your contractors have completed renovation. Are key to know before you take on the risk of a rehab project.

Rehabbing 101

The biggest factor in determining profit margin when rehabbing houses depends on the amount of repairs needed. This actually applies to both how fast you can complete them, and the cost. This requires good repair estimates from licensed contractors and timely and efficient renovations. And if used type of financing will weigh in on your net profit too.

Don’t try to wing it!

• Use systems and checklists for inspecting houses
• Get more than one estimate and professional home inspections
• Always factor in 10 to 20 percent for extra surprise repair costs
• Always do repairs right the first time never cut corners
• Be sure to get permits and use licensed and insured contractors

The best way to ensure profits when rehabbing houses is to anticipate things taking longer than expected, costing more than expected, and netting less than you hope for. Then if things do go according or better than planned you make even more than you thought possible, while being protected when hiccups and unexpectancies occur.

When to Start Marketing Your Completed Rehab

The faster you get your properties put on the market to rent or sell the faster you realize your return on investment. Some real estate investors swear by waiting until properties are 100% renovated and swept clean before even considering marketing them or letting prospective renters or buyers know about them.

Some real estate investors have found it more profitable to pre-launch their projects before completed. Also keep in mind there is always virtual home staging to help prospects envision how great a property could look after they move in.

In conclusion these are just a few tips on Rehabbing that will help you get an idea of this real estate investment method. I could literally right a book on this topic because of the complexity of this niche strategy. Stay tuned there will be much more info-packed content to come!

I”ll See you at the closing table,

Marcel Umphery the “R.E.I. Successmaker”