Remodeling a Foreclosed Property

You may be interested in becoming an investor in foreclosed homes. Quite often, there are great values available. However, think about it. If a homeowner is not able to make their payments and will lose their home, they are not very likely to have kept up the condition of the property. You will almost certainly need to do some maintenance work and very likely major renovations as well.

If you have acquired the property at an especially good price, this won’t present a problem, as there will be a lot of room left to do the needed work and still make a profit. The key is to know what needs to be done, how much it will cost and how long it will take. Here are some tips on how to access and proceed with a renovation of a house that you intend to resell rather than to occupy.

It is always better if you are handy and can do the work largely by yourself because labor is an important cost factor. If not, it may not be a deal breaker. You will just have to be sure your planned purchase and resale price allows for the cost of a contractor. You need to know this before buying the property. Do get bids from reliable contractors.

Before you tour the property and offer a price, you should be familiar with the costs of the materials you will need. It’s a good idea to start with a generic renovation supplies list and fill in the price ranges. Then, as you tour the house, check off the items it will need and summarize the rough budget.

The three major areas, ranked by cost to renovate, are usually the kitchen, then the bathrooms and finally the living room. Note that these are also the most important areas, for resale purposed, to have brought up to date.

The cost of new kitchen appliances and cabinets can be substantial. As the wife is usually the major decision maker and this is “her” room, you need to be sure it is clean and modern. Even if you decide not to replace the cabinets, change the knobs and handles.

This is followed closely by the bathrooms. Don’t overlook the value of shiny new faucets. Just like the kitchen cabinets, you will almost certainly need to replace the outdated vanities. Be realistic as you assess the porcelain items. Will it look good to have old and probably the wrong colored porcelain together with new vanities and faucets? The same holds true for the medicine cabinets.

So too with the light fixtures throughout. New, clean and modern looking light fixtures and ceiling fans are not expensive compared to the improvement in the overall ambiance that they offer. This applies to all the rooms. Switch plates and outlets are so cheap that you should not even debate their replacement. Window treatments become faded and dingy over time are likely to need to be replaced as well.

The subject of outdoor improvements, especially landscaping, is trickier. Certainly, you will keep the grass and bushes trimmed and tidy but look carefully at how much you want to put into new landscaping. It’s expensive and really doesn’t show it’s worth right away. It takes a little time for new plantings to grow.

You should, however, look into some simple accents, such as colorful planters or perhaps inexpensive solar driveway lights. A new mailbox and street address number sign are also inexpensive. If you don’t plan to repaint the exterior, at least be sure it is clean and perhaps repaint at least the trim areas.

Also, if the doors and windows are bare, consider adding shutters or other perimeter treatments. Lastly, do not focus solely on the cost of parts and labor, and overlook the timeframe for completion. Until you finish, your money will tied up in the house. How long may be as important as how much.

Original: Remodeling a Foreclosed Property