Property Investing in The 21st Century

Investing In Foreclosed Property

When you look at investing in a property that needs some renovating before it’s rentable or flippable, it’s really important to ascertain the degree of fixing required before buying.

Very often, you can get a great deal on a foreclosure but in many cases the family who previously lived there suffered hardship for some time so things may have been neglected. It’s worthwhile to do a thorough inspection to check to ensure that it’s not just fresh paint and cleaning that the home needs.

Here are some possible repairs that might be needed and these are listed in reverse order of importance/expense/hassle. The first few items on the list really aren’t typically that expensive or costly to deal with. But, as you get down the list, you’ll want to really consider whether or not this investment really is worthwhile. Some of these items, if present, could make the costs and hassles counterproductive for you so you may decide to either: lower your offer or even decline to make an offer on the property. Before making an offer, you also want to be sure you’ll get financing and / or insurance and certain repairs could make this difficult.

1. Cosmetics. Things like wallpapering, painting and basic cosmetics are easy and inexpensive to deal with and don’t impact the home too much.
2. Replacing flooring, fixing walls, replacing tiles and carpeting usually aren’t too expensive to worry about.
3. Electrical and plumbing issues can be a little more expensive. You want to be sure the home is up to code and some upgrades could get a bit costly.
4. Structural. Worries about the roof and the foundation could be a concern and will require careful assessment for safety and expense
5. Serious concerns such as asbestos or getting permission to renovate due to building status in terms of heritage status and zoning are worth getting professional advice about.

A little research into a potential investment property or foreclosed property will go a long way in helping you make wise investments so you can make money on your property investments.

Written by Clint Maher - 21st Century Academy
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