Real Estate Investment Blog
Who hasn’t dreamed of owning an investment property as rents rise and property values increase? Even in a declining market, the thought of extra income in the form of excess rent and equity sounds like something everyone could benefit from.
This blog is my journey from primary home owner to accidental landlord to active investor. Follow me and my stories on the joys, trials, and tribulations of owning real estate investment property.
I Can Do This, Too, and Probably Better!
As a real estate broker, I walk through homes in many different conditions.
New homes are always appealing. New homes are clean and unused. Design selections follow the latest trends. There is nothing not to love in a new home. New home prices reflect their desirability along with the cost of construction and labor. If you live in an established city like Mt Pleasant and the Charleston area, new construction will likely be on the outskirts of the city where there is land to build.
Renovated properties also typically look fantastic. In renovated homes, an investor has bought a distressed property and updated it for a profit. Renovations may include mechanicals like HVAC, electric, and plumbing or may only be cosmetic or a combination of both. Renovated homes are usually located in established neighborhoods and therefore sell for a premium.
I don’t know how many times I’ve walked through a renovated home and said, “I can do this, too, and probably better!”
Experience and expertise executed correctly always makes a process look easy, as though anyone could do it. In reality, this is far from the truth. Buying an investment property in need of mechanical updates and a cosmetic make over is one of the most challenging and daunting tasks an individual can undertake.
Even with a thorough home inspection and CL100 (wood infestation report), there will be numerous unexpected surprises that will require intense problem solving skills, additional resources for the increased costs, and time.
Setting expectations in regards to both time to complete and anticipated profits is important before embarking on this real estate adventure. With the proliferation of ‘flip this house’ reality shows on tv and the internet, most inexperienced investors have an unrealistic expectation of the time and the costs to renovate a property and the projected profits.
A property that needs renovation in a market like Mt Pleasant and the Charleston area should be viewed as a long term investment. After the initial renovation, if completed thoroughly, the property will only require routine maintenance going forward. Cosmetic updates and a well maintained property will attract well qualified tenants who will be proud to reside there.
In spite of the difficulties and challenges of the process, there is nothing more satisfying than taking a distressed property with deferred maintenance. outdated design, and poor layout and transforming it into a beautiful and valuable home and long term investment.
It’s something I love to do!