If rehabbing a property and making a profit were easy, everyone would do it. Almost anybody can buy a property and do some work on it, but maximizing an investment is particularly dependent on the little things. It is the little things that will make or break a proper rehab. There are a lot of little things that are just as important as the actual work you do on a property, and it is equally important not to neglect them. Pay close attention to how you budget your time and money. Furthermore, make sure you are looking at a property through the eyes of a buyer. These factors, and many more, will play into how successful you are as a rehabber. What you will find is that the little things make a huge difference over the course of a rehab project.
The importance of budgeting, scheduling and the quality of work cannot be understated. However, all of those can be undermined with one break-in and/or vandalism to the property. This is why it is important to protect your investment as soon as you take ownership of the property. Regardless if you are starting work in a few days, you should board any accessible windows, change the locks, put padlocks where needed and reinforce the entry ways from the inside. This may seem a bit too much, but if you have ever had a house broken into and had the pipes stolen and appliances taken, you would know this isn’t just an inconvenience. This is your property now and you need to protect yourself and your investment.
You also need to make sure that the homeowners insurance is up to date. If you purchased it through lender financing, it was already done for you. However, if you paid cash, it is your responsibility. Typically your attorney will remind you at the closing, but in the heat of closing and trying to get work lined up, it can easily be overlooked. All it takes is one fluke fire or weather related damage to set you back. Make a habit of it to get the insurance when you order the title on the property. This is one less thing you will have to worry about on closing day.
The same holds true for any utilities associated with the property. If your contractor needs to plug any tools or turn a light switch on, you will need to activate the electricity. After you close, you should be on the phone with the water & electric company to switch these over to your name. Some companies are easier than others to work with, but these factors are worth however long they take to establish. Even if you don’t need them for any work, you will when you decide to show the property. This should have been factored into your rehab budget and accounted for long before you turned the power on.
If you are making any changes or additions, especially with anything outside, it is a good idea to have your contractor run these by the town first. You never want to start a deck or an addition and have to change or stop all together to conform to a town code. This may slow you down for a few days, but consider the alternative. You could end up wasting weeks and thousands of dollars to change any work you already did when you just could have called the town for approval first. This isn’t needed for interior items such as a kitchen or bathroom, but any time you are adding or subtracting square footage, a deck or a pool, you need to get town approval first.
There are other little things that you need to think about before you start a rehab. If the plumbing is not going to be working for an extended period of time, you should consider a portable bathroom. If you have excessive garbage, you could consider having a small dumpster in the driveway. There could be work that is impacted by the weather. Weather alone can affect how you or your contractor schedules what needs to be done. You should also be mindful of any holidays and paying anyone that works on your property as soon as they are done. If the funds are not available or you do not pay in a timely manner, word will quickly travel and every other worker on your site will know. If you take care of the people that are working on your property, they will work harder for you.
There is a lot more that goes into a rehab than deciding what kind of countertops or flooring to put into the house. Sure, those items are important, but if you forget about the little things they will come back to haunt you. These little things will either protect your investment or protect your reputation. Ultimately, they will help you get more deals. The quicker you can recognize what needs to be done on every property, the more on point your budget and scheduling will be. These may seem like minor items in the grand scheme of rehabbing a property, but they can have a big impact on your bottom line. The more properties you are involved in, the more you will understand that the little things really aren’t so little.