Rehabbing a basic paint and carpet project is a great starting place for new investors, but at some point branching out to larger projects is an attractive proposition. From experience, implementing the following steps can streamline your transition and not only help you avoid costly mistakes, but also come out profitable.
Don’t go undercapitalized
While we are available to give you the backing you need to make the jump to larger projects; a larger project has a higher degree of complexities and a longer timeline. If something unexpected happens or changes need to be made, you want to make sure you are covered with enough money to complete the project.
Do your due diligence
Understanding your market and the demands of the location is very important. Doing your due diligence means that you see what others are doing in the neighborhood. This enables you to validate the direction of your project, or go back to the drawing board. When walking these properties, you can see what makes sense and what could be improved so your property stands out. This should be done in the pre-construction stage because once you start building it is harder and costly to make adjustments.
Proper Network
Surround yourself with the proper network. While you can easily manage a paint and carpet project by working directly with your carpenter, painter, flooring contractor, etc.; we strongly encourage you work with a general contractor on larger projects. They can help you get the project completed correctly and on time. Having a general contractor that can quarterback the trades (architectural, engineering, mechanical, plumbing, etc.) on your team is crucial. When looking for a general contractor, make sure they are properly licensed and able to pull the correct permits. This is imperative to you being able to stay on track with your timeline. With a larger project comes a larger span of potential problems and people to deal with. Although, if you have the right network, you can benefit from their experience.
Realistic Time Frame
With an intensive rehab you will have a longer time frame. While most lenders offer 6 month long products, and optimism my drive you to work with them, realistically plan for a 12-month timeline. A full gut renovation project will need time for permits, the rehab itself, and potentially a longer selling timeline due to a higher price point. Make sure you have ample time to complete your project and avoid paying extension fees that will eat up profits.
We understand it can be intimidating to take on your first big project, but don’t let hesitations hold you back. There are doors of opportunity waiting for you. We are here to support you and help you succeed. Contact us today and let us know how we can help you!