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🔍 1. Finding the Right Property
- Undervalued or distressed homes: Look for properties priced below market value due to condition or circumstances.
- Good location: Focus on neighborhoods with rising property values, low crime, and good schools.
- Strong comps: Ensure there are recent comparable sales in the area to support your after-repair value (ARV).
💰 2. Accurate Budgeting
- Purchase price + Renovation cost + Holding costs: Know all your numbers.
- Contingency fund: Always budget 10–20% more than your estimated renovation costs.
- Financing costs: Factor in interest if using hard money or other short-term loans.
🧰 3. Smart Renovations
- Focus on ROI: Kitchen, bathrooms, and curb appeal usually offer the best returns.
- Avoid over-improving: Don’t add luxury features that don’t match the neighborhood.
- Permits and codes: Ensure all work is legal and to code to avoid delays or issues at resale.
📈 4. Accurate ARV (After Repair Value)
- Use comparable sales (comps) within the last 3–6 months.
- Work with a knowledgeable real estate agent or appraiser if needed.
- Be conservative in your estimates to avoid surprises.
⏳ 5. Efficient Project Management
- Timeline discipline: Every extra day costs you money (holding costs, utilities, taxes, etc.).
- Reliable contractors: Use vetted pros who stick to deadlines and budgets.
- Regular check-ins: Stay on top of progress and quality.
🏡 6. Marketing and Selling
- Professional photos and staging: Helps maximize buyer interest and offers.
- Right pricing: Based on comps and market trends.
- Speed to market: The faster you sell, the higher your ROI due to lower holding costs.
📊 7. Exit Strategy Planning
- Have a backup plan in case the property doesn’t sell quickly (e.g., renting it out).
- Know your breakeven point and minimum acceptable profit.
