About This Post
The one truly great thing about the real estate market is its predictability – one way or another, the growing population will always need a place to live. That is why investing in an old house almost always turns a profit. Depending on the room, ROI can range anywhere between 54% and 87%.
However, it is important to remember that not all upgrades are the same. Let’s take a look then at some of the tips on how to renovate a property for profit.
Buy the worst house in the best neighborhood
Although it is not exactly a renovating tip, it is worth mentioning that houses situated in attractive neighborhoods have a very good chance of making a profit, no matter how run down they might be. If anything, such properties will most likely turn the buyers off and warrant a very low price. On the other hand, the houses that don't offer easy access to various amenities will be a very hard sell regardless of your efforts.
Prioritize the essentials
When it comes to renovation, there is a popular belief that investing in kitchen, bathroom and cosmetic finishes produce the best ROI. And, speaking in ideal terms, these claims are true. However, if your house is too warm, damp or has damaged foundations, the buyers will quickly see through the ruse and move on. So, when making a budget, give absolute priority to upgrades that keep the house together and save bells and whistles for later.
Rewire the house
The old houses were built in simpler times when energy consumption was not as nearly as high as it is today. These days an average PC takes at least three outlets, and then there are various appliances, TVs, DVRs, phone chargers, and so on. The power load is immense. To solve this issue, find an experienced emergency electrician to help rework the overloaded power points, replace any corroded wires, and then build your wire network from the ground up to suit the needs of a modern family.
Install central heating
In the grand scheme of renovation projects, central heating was always somewhat overlooked. And yet, this upgrade is reasonably affordable, always turns a profit and does a great job at improving the efficiency of a home. If your house already has a working boiler with a capacity that can support additional radiators, consider installing some neat features like under-floor heating, a heated towel rail and similar. Although not integral, such details always leave a good impression.
Remodel for sustainability
Sustainability is slowly taking over the real estate market. If you don't remodel your house with efficiency in mind, your investment will lag behind. The two absolute basics you must cover are proper insulation and double-glazed windows that will help the future owners with temperature management. The additional options you have on disposal are installing LED and CFL-based lighting and upgrading the bathroom with a heat recovery system that reduces consumption made by heating the water.
Don’t overlook superficial details
All houses have their fair share of small defects that don’t have any true impact on their value but can prevent them from being sold nevertheless. It would be a real bummer to pour piles of money to upgrade the bathroom only to see the house sitting on the market because of the things like sewer smell, poor door latches, squeaky floors, etc. Give your house a thorough check and address these small issues as soon as you notice them.
Think about ceiling value
Finally, don't forget that every property has its ceiling value. In other words, there is a point when your investments stop adding up to the overall value of the property. That is why you should do quick market research, determine the ceiling value of your house, and invest in the areas that make the most sense, only as long as it makes sense. Any other approach can only cut into your ROI.
Of course, house renovation goes way beyond these seven points, but they should set you in the right direction. Once you make a solid foundation, you will have a much easier job upgrading your investment with traditional sellers like interior décor and efficient appliances.
