5 Common Rehab Mistakes & How To Avoid Them

5 Common Rehab Mistakes & How To Avoid Them


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Each person involved in rehabbing houses is likely to make a few mistakes and that’s totally acceptable. However, sometimes these mistakes are quite big and can leave you in financial trouble or worse. It’s totally acceptable to make mistakes but being prepared and knowing the town regulations is essential in avoiding unnecessary consequences.

As real estate investors, we know that you can definitely avoid the major mistakes that can leave you in a dark pit by preparing yourself for rehabbing houses. Here are a few common mistakes to avoid. Check through before you begin any project.

  1. Not Getting the Appropriate Documents

There is a lot that goes into rehabbing a home, from raising capital to creating the scope of work. One thing not to overlook are all the mandatory requirements of each town. Be aware that there are commonalities, but every building department has their own sets of rules and regulations so make sure you and your contractor are aware and file accordingly. Documents and permits may seem unnecessary but if you are not abiding by the town regulations and they find out, you will get a stop order. This will cost you more time and money and headaches than the initial inconvenience of filing correctly in the first place. Most likely your general contractor will be filing for you but keep in mind your plumber needs his own permit, as does your electrician.

  1. Not Inspecting The Property

If you are a seasoned investor and no longer pay for a professional inspector to come through your house, make sure you still get another set of eyes on the property. Whether this be your general contractor or one of your business partners, big ticket items can always go unnoticed which will result in unexpected expenses. Think buried oil tanks, asbestos, bowed or sagging walls, cracks in the foundation, water damaged walls that can lead to corroded beams, etc. If you have years of experience under your belt or you are working on your first flip, make sure you have another person or team walk through the property with you to point out anything that may have been overlooked. Better to catch it now that having to use up all your contingency money.

  1. Cutting Costs in Essential Areas

There is a temptation of cutting costs when rehabbing. This is a major problem for those investors who have a limited budget or for those projects that go over budget. You will always be faced with one or both of these problems. As investors, it is essential to keep our costs as low as possible and often because we are so conservative with our rehab budget, we have to be conscious of what we spend money on.

At some point you will have decisions on the materials that you need to cut costs on. If this is the case, than there are decisions you have to make, but do not cut your material costs in the kitchen or the bath. Homebuyers are focusing on these areas and they are savy and overly picky when you market a home as “move in ready.”

In the end, you do not want to sell a property that is perceived as low quality to a potential homebuyer. So if you are running low on funds, cut costs on other areas and over spend on the kitchen and baths. For this blog for more tips on essential upgrades to include in any rehab.

Doing Jobs You Aren’t Trained For

It’ll be a wiser choice to pay a professional to fulfill a project correctly the first time, rather than doing something poorly yourself due to lack of training. You might later have to pay someone else to redo it adding up to the cost. Plus, you can get seriously hurt, particularly when working on electrical tools, plumbing, roofing, and certain aspects of landscaping.

Not Staging a Home

If you think the house will sell itself since it is freshly rehabbed, you may be in for a surprise. Most people do not have a vision on what a home will look like once it has furniture in it. Coincidently, rooms look smaller when they are not furnished, so if you have an odd size room or small bedroom, you should consider staging those areas to give homebuyers a vision of what they will look like. Addiotianlly, if you have oversized rooms, furnishing them will allow a homebuyer to envision how the rooms can be used efficiently.

Buyers are buying a home and not a house so staging your property will give them a feeling that they can live there and they want to live there.

Those rehabbing houses should attract the average homebuyer. Be careful while picking out colors, paints, etc. You’ll want to decorate in basic colors that are liked by most homebuyers. Going for neutral colors like tans, beiges and off shades of white will be a good idea while remodeling. Also try not to cut down on the cost when it comes to décor because it’s the first thing that appeals to a buyer.

Keep these common mistakes and solutions in mind when learning how to rehab a house the first few times. There are quite many other ways to make mistakes but these are some mistakes that you’re most likely to make. Remember, it’s better to be safe than sorry!

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