Here is a great tip for you to think about when rehabbing your houses. I have written about this subject before and I thought I would share some different ideas that will help you sell your houses faster and many times get a higher price than other houses in that same price range.
So, What Is The Secret To Getting A Higher Price For Your Houses Than Your Competition Can Get For Their Houses?
The simple answer to this question is doing what other investors won’t do!
Years ago I learned a simple but very powerful lesson that has since made a huge difference for me and those who have followed these suggestions.
Here is what I mean. When doing your rehabs always put things in your houses that would normally be found in houses located in a higher price range. It is a good idea to take some time and go to a few open house showings and take notes about what things these higher priced houses have that aren’t usually found in houses in the price range of the house you are about to rehab.
Look for things like the kitchen sink faucet, granite countertops, the master bath Jacuzzi tub and faucet, the vanities in the different bathrooms, the light fixtures, a slightly better grade of carpet with a thicker pad under the carpet, the ceiling fans and whatever else catches your eyes. If you are willing to spend a few more dollars for these up-grade items, it could easily allow you to get a higher price for your house. Of course, you don’t want to go wild but just a few of these items can give your houses the perception of being a higher priced home.
Let’s say you are about to start rehabbing a house valued at $100,000 to $150,000 that is located in a desirable area. If this is the case you might think about putting some or all of the items mentioned earlier in the house you are rehabbing that would not normally be found in houses in that price range. The up-graded items you are going to put in your house are items usually found in houses priced from $200,000 to $250,000.
If you are rehabbing a house valued at $200,000 to $250,000, think about using items normally found in houses in the $300,000 to $400,000 price range. You may be thinking why would anyone want to spend extra money for anything when their house is in an area where the houses are selling for no more than $150,000. Here is why. When you have a buyer who has credit sufficient to buy a house in the area of your house and they have been looking at houses in the price range of your house but haven’t been seeing the up-grades they are seeing in your house will definitely be impressive. Most buyers really notice the items you have put in your house that other houses they have been looking at don’t have. They will immediately realize your house is much nicer than the other houses they have looked at in that price range.
The up-grades you install in your houses may cost you a few more dollars to install, but many buyers will be willing to pay a little more for a house with the nicer amenities they haven’t been finding in other houses in that price range. What if you spent an extra $3,000 to pay for these up-grades? Personally I try to get back $2.00 for every $1.00 I spend. If I were to spend $3,000 for the up-grades I will increase the price of my house $6,000, and I will usually get it.
When you are doing your rehabs, it doesn’t take one minute longer to install a nicer kitchen sink faucet or a nicer ceiling fan. If you can get back a higher price for your houses and sell them faster, why wouldn’t you want to do just that?
Until next month, Happy Investing!