Building Wealth Rehabing Properties – A Great Investment Option
Rehabing properties is an attractive proposition to build long-term wealth with limited time and less money. The money you will be able to make depend upon the amount of money and the time you are willing to invest and your exit strategy. For example, if you are interested in building wealth rehabbing properties by buying a property, rehab it and sell it immediately, you might have a tax hit.
How Much Can You Earn
As mentioned earlier, time and money are the major factors deciding your income potential. If you buy a property rehab it and hold it for some time, your profit potential will depend upon your refinance options and the appreciation potential of the property in your area.
The price at which you buy the property is a major factor in determining your profits. It is often said that you make money while you are buying the property. If you want to hold the property you will make at least $ 10000 for $ 100,000 worth of repaired property, since you retain ownership of the property you will enjoy tax benefits.
How Much Time You Have To Invest
Building wealth rehabbing properties is a scalable business proposition. You can either do the business yourself or hire a team. You can buy and sell one property in a year or you can sell 50 properties in a year if you have a team. Approximately you can sell around 5-10 properties in a year if you are involved full time.
How Much Money To Invest
You may need not to make huge investment upfront for building wealth rehabing properties. Again it depends upon how you are funding the purchase. You may gain more profit when you fund the purchase yourself since borrowing money for a rehabber is an expensive proposition. However, you can make decent profit even if you fund the deal. Although your poor credit history, if you may have any, can make your borrowings costlier, you can use this situation to repair your credit. Yes, you can fix your credit and make money too.
How To Find The Property
The most useful source is a local real estate expert. As you are a first time rehabber, your local Realtor can offer you great projects. The Realtor who helps you finding the property would not charge you a dime since he normally gets his commission from the seller of the property.
Crunch The Numbers
Once you have inspected the property, it is time to work out the numbers. Work out the estimated costs very quickly because good rehab projects often sell quickly. You will not afford to wait for days. When you estimate the costs, you should pay close attention to big ticket expenses like a foundation repair or a roof tear. These sorts of expenses can really put you in a tight spot. You should have the real estimate of costs involved in the rehab work you are supposed to take. Once you have these numbers, you will know the profit you are going to make through rehabing properties. You can make an offer once you feel it is a sound investment option and determined to go with it.
Finally …
Sure, building wealth rehabbing properties is a great option. However, you must learn to enter into the trade. You can begin with the basic through lots of information available online. Once you learn the basics of rehabing properties, you can jump in to the profession and continue to learn. That is learning through experience for you.
