Secrets of Profitable Remodeling by Wee Dilts

Introduction
What is remodeling?
Remodeling is updating or altering the appearance and functional utility of a building.Home remodeling is big business. It accounts for about 40% of all residential construction spending and about 2% of the U.S. economy.
So to answer the question "Is it worthwhile to remodel my house?" Probably; however, there are many factors to consider.
Why Remodel?

First you need to determine what's your motivation? Why do you want to remodel? Are you remodeling for your self and your families enjoyment or to increase your appraised value?

Second do not expect a full recovery of your remodeling investment. Some estimates are as low as 40 cents on the dollar. Others, depending on what you remodel may recover more than 80%.

When to Remodel?

Other factors that will impact the return on your investment: 1. What sort of economic times are you experiencing? Are you in an up or down market? 2. How long do you tend to stay in the home? The longer the better for a good return on your investment. 3. How's the housing market in your area? Are you competing against a lot of new tract homes? 4. How will the remodel will impact your appraised value? Find out before you invest your money. 5. How strong is the resale market? Ask a local Realtor for comparable sales for your area. 6. How soon do you plan on selling? 7. Do you plan to sell with full MLS service, FSBO, or Flat Fee MLS?

Who should remodel?

Ask yourself who will do the remodel? How good are you at remodeling? If you're not really handy, maybe find a friend and barter or trade services. Are you going to do the work or hire the project out?

If you are considering remodeling, get three bids from local firms. Ask brokers, lenders, and appraisers if the cost of the remodel warrants completion. The percentage of return on the investment for remodeling will change over time and vary from area to area. Ask the professionals.

Weigh carefully the expense of remodeling based on the return. Do only those projects which will bring you a significantly higher sales price or greater family pleasure. Improvements and upgrades cause anguish for most sellers, because a seller wants to recover the full dollar value of the improvements. The industry standard suggests you will get back about 40 cents on every dollar. Don't expect to recover the full amount.

For Example, if you put in improvements totaling $10,000, you should expect a net return of approximately $4,000. As a seller, you must remember that you put in that nice brick walkway because you wanted it, not for its resale value.

What should you remodel?

Average 2007 cost vs. a value report - average ROI Deck 85.4% A major kitchen remodel 78.3% A bathroom remodel 78.3%

Kitchen and Bath remodels are always safe to consider for good dollar return on your investment.

Know this answer; are you adding something to the home that will bring you and your family pleasure and enjoyment or are you adding something to add value? Two very different considerations.

Areas of remodel that will bring you only marginal return on your investment are: 1. Home office 2. Sunroom additions 3. Family room additions 4. Master suite additions

Regional differences are also a consideration.

In the West Kitchens and baths are big. East coast and North leans more to siding, dual pane window and energy types of remodeling. The South is big on family rooms, sidings, kitchens and replacements. And the Mid West leans toward kitchens, baths and decks.

Summary

Overall the two normally safe areas to consider upgrading and remodeling for the greatest return on your investment, are bathrooms and kitchens.

You need to answer these questions before you begin: 1. Why are you remodeling? 2. Who will do the remodeling? 3. What are you going to remodel? 4. How long do you plan to stay in the home? 5. How will you pay for the remodel? 6. What return on your investment are you expecting?

If you answer these questions and plan your project, you can probably recoup between 40 and 80 percent of your remodeling costs.
Read more...

Foreclosure Investing And Fix And Flip Real Estate--How To Make It Work by Wayne Hemrick

Real estate investing has always been a popular way to earn money in the United States, and so it continues today. You might be considering getting started in foreclosure investing, but you will need to understand what is involved very thoroughly in order to have the best chance of meeting with success with foreclosure investing.
An early step that you will want to take in the process of learning more about fix and flip real estate investing is to look at local and state laws concerning the buying and selling of property in the town where you are considering purchasing property. In many, there are certain lengths of time in which you must live in any house that you buy, and if it is a long length of time, it may not work to your advantage to use that property to flip. For questions about local and state laws, you will likely want to consult with an attorney who can answer your legal questions knowledgeably.

If, after determining the laws that cover this area of fix and flip real estate, you wish to continue in this pursuit, the next step would be to find foreclosed homes. You can find foreclosed homes through banks in your area. Another way to find foreclosed homes is to look online for real estate auctions.

After you find foreclosed homes, the next step is to figure out how you will pay for the home. One way to go about buying foreclosed homes is to pay for them yourself, and this is the easiest way if you have enough cash on hand to make the purchase. Another way is to obtain a house loan through a bank. As with any type of mortgage, you will be given a better loan term the larger your down payment can be, so part of your strategy might be to save up a large down payment prior to getting into foreclosure investing.

If the point of buying foreclosed homes is to see a return on your financial investment, then you will want to make any needed repairs as inexpensively as possible and turn around and sell the house as quickly as you can. Ways that investors try to make more of a profit is either with buying foreclosed homes that are in good shape so that little rehabilitation is needed and can be sold quickly, or selecting properties that are in poor shape because they can be purchased for a very low price, with the understanding that they will need to be repaired more extensively.

Foreclosure investing should not be embarked upon lightly; it is best to read and gain all the information and tips that you can before you begin in order to have the greatest opportunity for success in this endeavor.
Read more...