DON’T PLAY HOUSE WITH FIX-UP
Daniel Webster said: “The world is governed more by appearance than by reality.” And, that’s exactly how your customers will judge your fix-up job.
If you spend $5000working under the house, you can consider that money to be mostly a gift for the next owner. If instead you can spend that money for beautification like exterior paint, carpets, new lawns and a white picket fence around the front, you’ll not only be in harmony with Webster, but you’ll also be adding sizzle items that both buyers and renters are willing to pay you for!
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My Mavis property consisted of 11 older rental houses on a two acre lot. It was completely overrun with weeds and bush when I bought it. About 50 percent of my fix-up profits were earned by simply cleaning and hauling.
Avoid the Two Deadly Sins
Whatever else you do DON’T PLAY HOUSE WITH YOUR FIX-UP PLANS and DON’T SPEND OVER 10 PERCENT OFYOUR ORIGINAL COST ESTIMATE.
Both of these DON’TS are not the easiest advice to follow! I don’t expect you to get ‘em both right on your first attempt. That’s exactly what I did and I don’t know of any shortcuts to help you! It simply takes practice!
When Mavis sold, I had made a $150,000 profit. The profit cost me roughly $20,000, which I think you’ll agree, is not very much to spend for that much profit. This is fix-up lever¬age! For the Mavis job, I’m talking about 7.5¬to-t leverage. That means for every dollar I spent doing fix-up and clean-up, I got back $7.50 when I sold the property. 1 might add that during the 14 months I owned Mavis the monthly rents were increased over $1200. Natu¬rally higher rents equate to a higher resale value.
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