Whether you are buying a new house, or currently the homeowner and looking for a new take, it's always good to look at the bigger picture before you lay down the cash. There are buyers who will purchase a house to flip and sell again at a higher value, and then there are homeowners who renovate to list with a bigger number. Before you become either one of these, ask yourself: Is it worth it? If yes, what is the best financial way to?
Step 1: Research. Look into the pricing and benefits of renovating the room in mind. If you are a buyer looking to flip, research the neighborhood. Although you can have a great price in a least favorite neighborhood, doesn't mean it's the best investment. You may have difficulty reselling quickly despite your thousands of dollars installations.
Also, research your financials. Kimberly Carver from doityourself.com said, "to be financially ready to flip a house means making sure that your credit score is excellent, and that if needed, you have plenty of cash on hand, or at the very least a way to get that cash quickly, such as through a home equity line of credit."
Step 2: Confront Experts. You'd like to know your renovations will be fully functional so give your electrician and plumber a call. Give a real estate agent a call too. Discuss what benefits you can get out of your home's new look and how they can help you sell.
Step 3: Flip or Spoof Up. Evaluate the property and decide if you need to do a complete flip or if you only need to do some repairing. Recognizing the difference will make your bank account love you a little more.
Step 4: This can go back to step 1, but if you're invested on flipping: stick to your budget. Stick to it but also leave yourself a small percentage cushion. Unexpected expensive may spring up like additional mortgage payments and property taxes.
When You Should Walk Away
So you read the steps of deciding to continue with the idea of flipping. Here is a short checklist to follow when to walk away. If your home has any of these, you might need to put the new kitchen cabinets on hold and deal with the major issues.
- Any type of water damage. Flooding, leakage, dripping. Make sure the plumping is up to code.
- Do you smell anything funky in the house? Check for mold, wet or dry rot.
- Look into what's behind the walls. Do you need to update your wiring?
- Are there any unwanted guests letting themselves in? Take care of any insect problems.
- Is the exterior is need of some TLC?
- Will the repair cost more than $3,000 - $4,000?
Call us at 718.370.3200 if you have any questions. We have a break down on renovations and what we can do for your home!