ARV over acquisition, holding, and marketing costs, so it’s extremely important they are accurate. A trustworthy investing software is a must for this purpose and, really, all aspects of real estate investing. Renovation budgets must be created with several factors in mind: costs individual to the property, its location, and current materials prices. It is best to err on the side of caution and consult a local licensed contractor for project bids versus using a generic formula. A reputable contractor is an essential part of your renovation toolbox and can be a huge help in many ways. They are usually creative and can provide excellent ideas for design challenges; they can keep the project on time; and they can itemize bids for labor and installation materials separate from customer-supplied materials and finishes, making it easier to stay within and on top of your budget. So, where does more creativity and an open mind come in? We’re getting there! For most retail projects, the renovation budget consists of a mix of structural repairs, functional redesign, and cosmetic updating for a property to reach its full ARV potential. Structural repair costs like the foundation, roof, plumbing, and electrical don’t offer any real dollar stretching and belong at the top of a budget priority list. It’s important for a professional home inspector to iden- tify these types of issues before an investor commits to a project. Struc- tural issues should be considered and accounted for when an investor negotiates an acquisition price. Now that the structural issues have been accounted for in the budget, it’s time to address what will make the property appealing to potential buyers.
repackaged, recycled paint in 3- to 5-gallon buckets. Early on, paint types and colors were dumped together and blended into” light” or ”dark” brown options, but the process has been improved over the years to create a wider array of neutral colors. Many don’t separate by finish, so the end product is an eggshell variety, which works great for interior walls. Some facilities even separate and blend specifically for exterior grades. And. It’s. Free. Search the internet for “reblended paint near me” for local facilities. The image of the interior staircase in the accompanying photo shows another great bud- get-stretching design upgrade. When faced with a house full of outdated, cracked tile, investors automatically think the fix is going to be expensive, and it can be. The cost of labor to remove old tile from a con- crete subfloor and to replace it with new tile or even carpet can take a huge bite out of a renovation budget.
DESIGNAND COSMETIC FINISHES
Functional design and cosmetic fin - ishes are the first things potential buy - ers look for after price and location. Exterior curb appeal, interior layout, and finishes are all big-ticket features buyers don’t want to be required to change immediately. Clean, neutral, and functional elements are musts. But what is big-ticket for buyers is also big-ticket for investors, right? Not necessarily, especially when you look at ROI. It’s worth the cost to update responsibly, but the question is how to stretch those dollars and make them go further. Bulk and sale pricing on finish materials like tile and carpet is old news to investors. But materials like windows, shingles, siding, granite, and paint just don’t go on sale often, especially in the quantities needed for large-scale projects. It’s not common knowledge, but many local recycling facilities offer
A rehab project using interior reblended paints. The floor finish is an example of another budget-saving technique involving a sealed concrete overlay.
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