Every property investor wants to see a “sold” sign out in front of their latest project. To see that sign and realize the profit from the sale, it takes diligence, hard work, and proper planning to ensure that the right amount is invested in the right upgrades.
Use these six tips to cut costs while still making property improvements that will up your profit potential:
6 Tips to Cut Property Improvement Costs and Increase Profit
- Time is money: don’t take your time. Doing all the work yourself will certainly save you some money, but if it takes you three times as long, is it saving you anything? It’s not (see House Flipping Success Rule #5). Hire contractors or workers to work during the week to speed up the process and get your project on the market faster. It will save you money in the long run.
- Find inexpensive labor for certain jobs. Hire professional contractors to do major upgrades and highly skilled work, while cutting costs by hiring high school or college students for jobs like painting, cleaning and yard work.
- Buy overstock. When shopping for building materials, ask a manager about the overstocked materials. Chances are that they want to clear the overstocked materials from their storage. In this case, they’re more likely willing to cut a deal with you.
- Get creative. Don’t sacrifice the style of your finished project because beautification is too expensive. Think outside the box and create dramatic, beautiful looks by faking it.
- Buy houses that have been on the market longer than 60 days. Realtors are more likely to cut prices to get the house off their hands. Show up ready to bargain with financing already in line.
- Give the walls a coat of neutral, light-colored paint. Though it is possible that the buyers will paint over your chosen color, a light color will open up the room and make it look large, spacious, finished, and liveable for a relatively low cost. Paint gives the illusion of light without the added cost of an electrician and a new light fixture.
There are many other ways to cut costs while flipping a house, but you should never sacrifice quality for a good price. Your potential buyers will notice if you skip out on essential repairs - even cosmetic ones - and they will skip out on signing a contract.
Catalyst Funding helps clients reach their fix and flip goals. If you need help funding your latest project, contact a hard money expert today for information on our loans so you can begin working toward the “For Sale” sign.