If you want to make money out of property, a good way to do it is to renovate an old property. In this article, we give you an overview of what it takes to successfully renovate a property and ensure that you actually make a profit rather than a loss.
Buy the right property
By far the most important step is to buy the right property in the first place. You should never rush into buying a property especially one that needs to be renovated.
Take the time to do your research and work out the real resale value of a property. In a falling or stagnant market, you have to be particularly careful.
If you spend three months, re-furbishing a property the price you can get can easily fall to the point where you actually lose, rather than make, money. Reading the legal pack and getting the property professionally assessed are both essential to avoid buying a money pit.
Planning is essential
The best way to make a good profit is to flip your property quickly or get tenants in as soon as you can. To achieve this you need to plan the renovation work carefully.
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It takes time to make a comprehensive list of what needs to be done, but doing so is essential. Nothing can be missed.
Put together a timeline of the work, so that everything is done in the right order. There is no point in getting the plasters in if you need to install new electrics.
Carrying out the work in the right order will ensure you do not end up paying for anything twice. It will also ensure that the renovation goes smoothly and help to keep costs under control.
Set a budget and stick to it
Before you start, decide on the standard of finish you want to achieve. Think about your target buyer or tenant and look at what is available in the area. There is no point in going for a high-end finish if people who buy or live in the area do not expect this and are not willing to pay for it.
You need to cost out each element of the renovation. Your experience from past projects can help with this. If this is your first renovation online forums can give you a good idea of costs, or you can simply ring a few suppliers.
Always have a bit of extra cash available. Things go wrong and unexpected costs are normal, so be prepared for this eventuality.
Economise where you can
Take the time to shop around for building materials, labour and services. Doing so can save you thousands.
The internet is a great way to find the best deals. You can use it to keep every single cost as low as possible. For example, using www.skipandbin.com will ensure that you get the best skip hire deal.
Saving a few pounds here and there soon adds up. It is always worth considering using second hand building materials. However, be careful not to ruin the overall finish of your renovated property. Bear in mind that buyers who are being shown renovated properties expect to be shown flawless properties that they do not have to do any work on.
By following the above principles, you should be able to successfully renovate any property that you buy and make a good profit.