Flipping Older Properties

 4 Tips for Flipping Older Properties

Home flipping often involves homes that have seen a few decades and better days. In fact, the best purchases usually involve homes with good bones that have had time to sag and peel over the years. By making these houses both beautiful and cozy again, you can drastically increase your returns with the right renovation choices.

 

1) The Old Home Checklist for Flippers

• Plumbing
• Wiring
• Insulation
• Caulking and Weather Stripping
• Roof
• Major Appliances
• Kitchen Appliances
• Security

When selecting and planning to flip an old home, always run down the checklist of major maintenance and upkeep issues. Older houses tend to have some predictable problems that - when you are aware of them - are easy to plan for.

 

2) The Health and Safety Update

With your checklist notes in-hand, start with your health & safety update needs. Does the house need new wiring or outlets for safe use? Are the pipes about to rust through or leak heavy metals? Do the fixtures leak, do the lights flicker? Is the roof within 5-10 years before needing a new replacement?

These essentials are the majority of what home flipping can do to bring an old home back into the move-in-ready housing market.

 

3) The Energy-Efficient Makeover

Next, address the home's energy efficiency. Modern homebuyers know how to check for those little details like rattling windows and whistling door frames. These are also easy and affordable things to fix. Re-caulk the windows (and the bathrooms, while you're at it). Put new weather-stripping on all doors and on windows that open. Add more insulation to the attic and, if you open any walls, add or replace insulation there, as well. Just properly sealing the house can make a big difference in it's subtle comfort and long-term appeal.

 

4) The Technology Upgrade

Finally, consider the in-home technology. The HVAC and water heater are top priority, followed by the kitchen appliances and an included washer/dryer set. New appliances are the key to transforming a kitchen and winning over modern buyers.

If you have some extra time and budget, consider a few integral smart upgrades like a keypad door lock, smart thermostat, and wifi-responsive garage door opener to really enter the competitive market with your flipped transformation.

 

Old homes are a home flipper's bread & butter. Once you master transforming an older, shabby house into a beautiful modern-feeling home, you'll start seeing the resale revenue you got into the industry for.

Flipping Homes in Historic Areas

 How to Flip Homes with Historic Area Restrictions

Home flipping is an essential way to bring failing homes back into the housing market - a vitally important role with the housing shortage today. One of the biggest challenges for home flippers is working with homes in historic areas with renovation restrictions.

How can you make a home warm and welcoming again without compromising it's incredible history? We have a few helpful tips to share.

 

Get to Know Your Historic Restrictions - And Why

The first and best step is to really get to know your historic restrictions. Take a walk-through with a regulatory member of the community. Let them tell you the story of the house alongside the rules so you can admire both the spirit and letter of the regulations.

 

Ask Your Neighbors for Contractor Recommendations

You're going to need specialized teams that already know the historic area restrictions and how to maintain a house within them. So ask your neighbors - also residents of historic homes - who they hire. Their roofers, plumbers, and builders will have the years of experience with the neighborhood that you need to draw upon.

 

Remove, Restore, and Replace Original Materials

You can remove cracked features and add modern amenities (like between-wall insulation) without actually getting rid of the original surfaces. Remove, restore, and replace materials in the home. Add that insulation, but then replace the original wood paneling - perhaps a few inches out from its original position. Fix the cracked plumbing and then put back the original faucet and handles. This keeps the house historic, with new and functional internals. Like a classic car with a new engine.

 

Updates that Embrace the Historical Style

Finally, if you need to make changes, ensure every update embraces the historical style. That old sink might be too cracked to restore, but find a new one of the same shape and material as a replacement. Seek antique restored fixtures from the same time period or to recreate historic molding designs instead of using standard modern pieces.

 

With determination and a love of history, any home flipper can renovate a property with historic area restrictions. All you need is the local insights and an appreciation for the home's original style.

 

Complete Checklist for Potential Real Estate Investments

 A Complete Checklist to Refer to Before Putting an Offer on a Potential Investment Property

o If you are thinking about putting an offer on an investment property, the most important thing you can do is "run the numbers" first. What does this mean? This translates into creating a spreadsheet of what your expenses will be on a monthly, quarterly, or yearly basis. You should also try to account for expenses that are billed on an as-needed basis. Here's a quick checklist that you can refer to help start you on this journey.

Monthly Expenses

• Mortgage. Evaluate what your expenses will be by getting pre-approved before putting an offer on a property.
• Escrow. This includes property taxes and insurance costs.
• HOA or Condominium Fees. These may be collected on a monthly or quarterly basis.
• Utilities. If you include utilities ( electricity, cable/phone/internet)  in your rent payment, this will still be an expense for you.
• Security Fees. This refers to a home alarm system.
• Property Management Fees. If you employ a service, this could be a set monthly fee or based on the cost per rental. 

Quarterly Expenses

• Trash Removal. In some areas, this is not included in tax payments.
• Pest Control. Depending on the area of your investment property, this could be a contract you have with a local service for a monthly or quarterly service.
• Water Service. This expense is regularly calculated quarterly.

Yearly/Other Expenses

• Contracts. If you decide to get a contract for things like appliances, hot water heater, air conditioning and heating units, in order to keep an eye on aging units. 
• Service Calls. This could include fixing a garbage disposal, electricians or pest control. If you don't have a contract, these will be calculated on an as-needed basis.
• Landscaping/Snow Removal. These expenses are billed only at the time when service is rendered.
• Large Purchases. This could include oil, natural gas or propane delivery, replacement furniture if you offer a furnished property, replacement/service for broken appliances or units.
• Tennant Changeover Fees. This could include the cost of painting, cleaning, trash removal and credit checks.

Depending on whether you are purchasing a vacation rental unit or a long-term rental property, could wildly influence where the bulk of your money is allocated on your spreadsheet. It could also determine if this unit is really the great buy it looks to be at first glance. 

Costly Rental Property Features

 Four of the Biggest Features in Rental Properties That Lead to Hemorrhaging Money

Owning a rental property can come with hidden or unforeseen expenses. While many property owners factor in things like taxes, HOA or condo fees and insurance, the real cost is the maintenance and upkeep of the property or unit. If you are considering purchasing property, keep these four things in mind. 

Hot Tubs and Swimming Pools

Hot tubs and swimming pools demand constant oversight with regards to maintaining PH levels, cleanliness and repair/maintenance. It is important to have them under the care of a professional who can identify problems before they become too costly. 

Decks, Docks and Exterior Structures

Property owners should regularly inspect any structures that are constantly exposed to the elements. The potential for damage,  including anything caused by weather or animals, can be a hazard to renters. It can also be difficult to repair. 

High End Appliances

While many homeowners want their kitchens to look nice in photos and provide top of the line appliances for potential renters, consider whether it is worth it in the long run. In some cases, finding replacement parts or repairing an expensive appliance may take a lot of time. In this case, the renter would probably have preferred a more off-the-shelf, easier to service item. 

Older Heating or Air Conditioning Units

When purchasing a rental property, consider the age of these units. Many of these units have a life span of 15-25 years. While you may be able to get away with replacing parts as needed for a little bit of time, all those service calls and up and no one likes being without air conditioning or heat during extreme temperatures. 

Remember that when purchasing a rental property, to be sure to see not only if the items mentioned above are in good working condition, but if so, how much it will cost to repair or replace these items in the future. Next, set aside a small savings account to help cash flow these items so you are prepared to fix them as needed. 

Deciding Neighborhoods for Your Real Estate Investments

 How to Decide Which Neighborhoods Are the Best Fit for Your Real Estate Investing Strategy.

Most people say, "location, location, location" because the location is very important when it comes to investing in real estate. You need to find the right properties in the perfect location at a good price if you want to make a profit on your real estate. 

So, how can you decide which neighborhoods are the best fit for your real estate? Here are some things to consider. 

You need to figure out who you want to rent to, before you choose a property. If you are looking to rent your properties to college students, you are going to want to find properties that are close to certain colleges. If you want to rent to couples with young children, you are going to want to make sure that you select neighborhoods with playgrounds and good schools.

If you prefer to rent to older couples who are going to take good care of their home, you may want to look for neighborhoods that have an active senior center. You may even want to choose properties that are near communities for those over a certain age. You will attract others who want more freedom, yet they want to be close enough to their friends. 

You also should think about the types of rentals you want. Are you going to want seasonal rentals, where people vacation? This may bring you more income because people pay more for a week's vacation than they do on their home. However, you are also going to have to set up bookings and make sure that the rental gets cleaned between each tenant. You may also have downtimes, when you won't have anyone interested in renting your property. 

Would you prefer to find homes, where your tenants may stay for a year (or even longer)? Long-term rentals can be great, because many will take care of the property like they would their own home. They don't mind mowing the lawn or even doing some painting, because they are in their own home. 

You also want to choose neighborhoods that are decently priced. If you decide to pick property in a lower-priced area, you may not be able to get enough rent money to afford your mortgage. Instead, you are going to want to find neighborhoods that are decently priced. However, if you choose a location that costs too much, you might find yourself in over your head. 

Choosing the right location for your rental property can be challenging. You want to get the right tenants, so you have to choose wisely. To do so, you really need to think about who you want living there. Do you want young parents, or would you prefer to do vacation rentals? You also need to make sure that you can get the property at the right price. Otherwise, you could be paying them to live there! 

 

Determining Rental Value

 3 Ways to Determine the Rental Value of a Property Based on Its List Price

With the housing market going topsy-turvy over the last year and half, figuring out the rental value of an investment property can be difficult. Zillow and other online estimates can be outdated and old ways of pricing may not be the most accurate. If you are considering investing in a particular market, it is important to do your homework to determine if the purchase is a sensible one. You may need to look beyond the price per square foot. Keep in mind, this may require some good, old-fashioned detective work. 

Interview Property Management Companies 

Whether you are choosing to go with a property management company or not, asking them questions about the market is one of the best ways to determine if a property is worth your time. Discuss with them what the rentals have been like over the last year, and when you can, over the last six months. This will give you an estimate of how easy and at what price point similar properties are commanding. 

Talk to a Realtor

Realtors can tell you a lot about the community, the most recent price of similar properties and other things planned for the community to determine if there will be a lot of competition for rentals shortly. For example, if you are buying a condominium in a particular area but there is slated to be a new high rise apartment building in the area within the next year, find out what similar units will be asking for in rent. 

Consider the X Factor

While the price per square foot is a great launching point in determining the rental value of a unit, consider the amenities and other intangibles that can add value. Things like a doorman building in a city environment, access to gym facilities, outdoor space, new appliances, and even a great layout or view can have positive effects on your ability to command a higher price for your property. These types of comparisons may include a visit to other buildings or single family dwellings to determine how your property compares.

The best advice is to talk to the people on the ground who have seen how the rental market has reacted to the swings of the last year and a half. Sometimes that conversation can be invaluable. 

Benefits of Property Management Companies

 Why You Should switch to a Property Management Company Before Winter Starts

Snow, ice, water, low temperatures, and other factors are some of the things to deal with during winter. You have not invested a lot of money in your rentals to start making losses in winter, which can easily negate all the gains you have made this far this year. Property management ensures that your rental property remains both profitable and valuable throughout the unpredictable fall/winter.

Keep reading to discover these top 4 reasons hiring property management makes all sense now than ever.

1. Maintenance and Repair Works

Tenants have to deal with low temperatures during winter. Essentially, they're mostly indoors because of the harsh weather outside. This basically means that the HVAC system will be working harder. If it's included in the rent, then it's your responsibility to ensure the heating equipment is in good condition. Managing this can be hectic, especially if you have a couple of properties. Rental management companies have created relationships with the best HVAC contractors and got the team to deal with all those repairs and maintenance. The result is happy tenants, which keeps your property occupied. 

2. Cut Costs

The harsh weather plus the long hours spent at home means high electricity usage. During the winter, you want to reduce expenses as much as possible if utility is part of the rent. Property managers can improve the property's energy efficiency by sealing windows or cracks to prevent heat loss. Besides, they ensure the heating appliances are in good shape and energy-efficient, as well as installing energy-saving bulbs.

3. Accidents and Fire Prevention Precautions

It's no surprise that most property fires and accidents are reported during winter. Such can mean costly litigation and unrecoverable property damage. Hiring professionals ensures that neither has to happen to you. This is done by ensuring fire/carbon monoxide alarms are working and eliminating any appliance that may cause fire beforehand.

4. Preparing the Rental for Winter

The reason you own rentals is to make an income. But that depends on whether you have tenants all through. Property management makes it easy for tenants to stay put when winter approaches by making the area safe through:

• Cutting down branches or trees that may pose a danger during winter.
• Cleaning and clearing drains and gutters.
• Checking roof and water pipes for leakages
• Measures to clear ice and snow off the rentals

Hire Leaf Management for Quality Services

Our business is to make yours profitable and long-lasting. Years of experience give us an edge to better manage your property. We protect your tenants and investment with our state-of-the-art tenant screening and market know-how. Contact us today to learn more about our services, including private financing options.