Have you been wondering if buying a fixer upper is a smart investment move? When you realize the potential offered by real estate investing to build financial stability, generate passive income, and create generational wealth, it’s only a matter of time before you want to pull the trigger. If you are ready to begin your real estate investment journey, or you are already investing and want to expand, we can help.
One popular investment strategy is buying a fixer upper. By choosing a property that needs some renovation, you can potentially improve and renovate a home that had a lower price tag to create equity in the home more quickly.
Benefits of a Fixer Upper as an Investment Property
By fixing up a home that needs some TLC, you benefit in multiple ways.
Lower Purchase Price
One of the most attractive features of a fixer upper is the lower purchase price. You may be able to buy a home in an ideal location that provides major potential, and access a property that can become significantly more valuable in a short period of time.
Especially if you have the skills to do some of the renovations yourself, a fixer upper can be a great way to monetize your skills and invest your effort alongside your dollars.
While all fixer uppers come with some risks and the potential for unpleasant surprises, they often offer an amazing bargain on a lucrative investment.
Customize the Home
When you buy a move-in ready home as an investment property, it usually does not make financial sense to do much updating. In your purchase price, you already paid for the newer features the home has to offer.
When you buy a fixer upper, you get to choose the features and finishes you are putting into it with your unique strategy in mind. Not only can you work within your own budget and personal preferences, but you can fine tune the design for maximum rental revenue, widespread market appeal, or resale value.
Accelerated Building of Equity to Leverage for Your Next Goals
A fixer upper’s value will increase more rapidly because of the improvements you make. As you build equity (the difference between your loan amount and the property’s market value), your opportunities for further real estate goals grow.
Whether you are planning to sell the home quickly (as a flip), or cash out some of the equity to move on to your next investment project, a fixer upper may provide an accelerated timeline because you don’t have to wait for the property to appreciate.
Types of Investment Properties
There are many ways you might decide to use your fixer upper. Depending on your goals for the property, you might orchestrate your plans differently. A fixer upper can be a great candidate for many types of investment goals, including:
- Short term vacation rentals
- Resale for a profit
- Long term tenants
Financing for a Fixer Upper
Financing for an investment property is likely on your mind. The best advice we can offer is this: work with a lender who understands the entrepreneurial mind and knows how to come up with creative solutions, like us. Some of our loan options include:
We have a dynamic list of financing options to meet different needs and scenarios. Contact us any time to learn more about how we can help you reach your real estate investing goals.
