Renovations and Value Creation

[Tyler Radcliff]

When looking for a good deal, how do you know the best way to renovate a property to add value? Is it best to talk to agents or should I start with other investors? I'd like to get in this as quickly as possible, but I'd at least like to minimize my risk (I know I'll make plenty of other mistakes).

[Will Fraser]

Hey @Tyler Radcliff!  An agent could be good, or worthless to talk to.  Same thing with a fellow investor or lender or about anyone.  What will give you the best bang for your buck is to find someone who understands the exact impact each rehab item can add to the value of the home (either in sale value or rental attractiveness).  As a real estate agent who flips homes and operates buy-and-hold rentals I think the aspect of operations that has given me the best feel for what you're asking is flipping.  

Seeing what the market will pay for, what appraisers look at, and what tenants clamor for  and seeing how to duplicate that in each successive rehab project gives a better understanding than I could have had simply as an agent.

In general, bathrooms and kitchens are what people pay the most for.  A bedroom is a bedroom, but a killer kitchen buyers and tenants alike will crawl over each other for.  Be careful not to over-renovate, but put some love into these rooms and your end-user will love it.

Good luck on the journey!

Will