 Helpful
Real Estate Tips
For more real
estate tips, see our Tips Archive
 BUYING A HOUSE FOR PROFIT$$
First off, I suggest you make a “wish list” of
everything you would like in a home including the price and the
amount of equity you hope to receive in profit when you sell it.
This will help you keep focused when you are overwhelmed with
house “shopping”. After all this will probably be the most
expensive single purchase that you make. When you consider the
asking price, make sure you are comfortable with it. If you are
able to negotiate an even lesser price, you are ahead of the
buying “game”! One of the worst stresses in life is feeling so
strapped with money that you won’t even enjoy your new house.
Besides living in that dream house, wouldn’t you like to make a
profit on it someday?
The best home to buy whether it is your first or tenth home
is a “fixer-upper”. You will have instant
equity of course providing you improve the items that were in
need of repair, updating, or just sprucing up. The key is to buy a
home that needs “cosmetics”. What are “cosmetics”?
The property should have easy, inexpensive, and profitable
fixing up. You would profit immensely from a home that needed
fresh painting in and/or out, new wall-to-wall carpeting, new
light fixtures, a good cleaning, and a fresh new curb appeal
landscaping. These
items will spruce up a house unbelievable. If you decide to tackle
a more extensive rehab project…be
aware. Once you start changing this, and breaking down that,
you sometimes get into what I call “Pandora’s Box”. Your
remodeling plans can change by the day and so can your budget when
it is a big project. You will also need to check out your city
laws. Larger projects may require a building permit and will
need to be reviewed by a building inspector.
My husband Victor and I purchased a house that needed all
the cosmetics, remodeling of the kitchen, bathroom, and lots more.
It was in a depressed redevelopment area. The trend in the area
was rehabbing historical homes. We purchased it for $85,000. and
we sold it three years later for $207,000. Oh yeah, we had it
rented during two of those three years, so it floated itself. Nice
return. Where did we get the money to keep pouring into it? By
refinancing it and pulling cash out of it. We did this about 3 or
4 times in the three years. Yes you do incur costs refinancing
each time, but do the math. I found it less risky than the stock
market and more profitable. Not all of us have thousands and
thousands of dollars to risk, but most of us can handle a home
purchase or maybe even two….one to live in and one for fixing
up. If you make a large profit from your primary home when you
sell it you can buy two houses. That is how we started. Another
plus is each time you take the cash and use it for the house, the
value goes up. Each time we refinanced it, it would have to be
appraised again at the
new increased value. Yes it was costly and required lots of labor
but the profit margin was well worth it!
You will have to set your own
realistic “fixer upper” goals. What about the neighborhood?
Check to see if it is an up and coming area or an established area
or if the town seems to be flourishing, and what type of local
crime exists. Visit the town’s city or county website to try to
get these answers or go in person and take some of the handouts.
Pick up their local newspaper or visit the local newspaper
website. Check the real estate classifieds…do your homework!
There surely is a difference in crime statistics between
domestic disputes or a rash of burglaries and murders in the town.
If you inquire about the crime within the last month at the local
police department, they can answer those questions. Check the
school system in the area. Visit the local school’s or
district’s website. A neighborhood with a good school system
will help keep the value of your home. There are many areas in the
United States that are going through a “redevelopment”. Some
of the municipalities actually offer monies to help you with the
redevelopment at interest free or low interest loans! With all the
unsteadiness of the stock market many people are turning to
investing in real estate. It could be a fast and hefty profit!
Even if you are not “handy” yourself or do not have the time,
choosing the right “improvements” at the “right” costs can
bring you a nice profit. If you are working with a real estate
agent let them know that you are looking for a house that needs
TLC (Tender Loving Care). They may know of a home where a seller
has let the house go and needs to get out quickly and is open to
negotiation. I sincerely hope that I have given you some helpful
tips in your home shopping trip. Good luck!
You can obtain more info and tips on buying or selling your
home in my book. As
always, if you have any questions, please contact me, I will try
to help!
Irene
Montalban
For more Be
Aware topics, tips, and real-life real estate experiences, please
order your copy of:
The
Be Aware of Real Estate Handbook Today!!
|
Paperback
Edition $13.95
AVAILABLE NOW!
Order
Today and Save on Shipping!
CHECK OR MONEY ORDER ACCEPTED
Don't make the
same mistakes that have already been made by other home buyers and
sellers.
Learn the secrets
of
realtors, mortgage companies, buyers, sellers, etc. and
others involved in the home buying and selling.
Qualities that
you should look for when choosing your Real Estate Agent and
Mortgage Company.
A helpful
checklist to use when selling your home by owner.
|
