Buying a home for rehab is an involved process, one that you should not go into unless you are prepared to invest time and money into. The value of a rehab is that you can usually get a home that needs repairs for a substantially lower price than a completed one. If you are able to put time and energy into it yourself, you will save money on the repairs and therefore when the value of the home goes up upon their completion, you will net the profits. By focusing on specific improvements you can greatly benefit your homes value, while some are less valuable.
You want to purchase a home that already has working plumbing, heating and electrical systems. These are all expensive improvements that will not be noticeable when selling your home. If you are purchasing a home that needs these improvements, make sure you have the costs necessary to fix them taken off the price. From here you can move on to more cosmetic improvements. Bathrooms are a great start, as new fixtures can make an older looking room very modern. As well, much of the work can be done yourself. From here, move on to floors, putting in new carpeting can drastically change the look of a room, and hard wood will certainly raise your asking price, though it does require more of an investment. If the home has a fireplace, putting in a new one will also add value.
Kitchen improvements can be more expensive, so they should only be done if the oven or refrigerator is very old. New counters are cosmetically appealing, but can be a hassle to install. A universally appealing improvement is new windows; this is for a few reasons. First, they are attractive, and second, they provide great energy saving benefits, as insulated windows will reduce energy costs. You will want to specifically advertise the new windows and if you put in new carpet, mention that. These are selling points your customers will be looking for.
Painting rooms is always an option, it will give the room more variety, and it is very inexpensive if you do it yourself. Most of these improvements can be done yourself. Carpeting or floors will set you back more, but it will be apparent you put the resources in when your buyers enter the home. This benefit will help sell the home, and that’s what all this is really about.