If you’re property wise, you’ll be looking to make more “profit” when you buy a home than when you sell it in future.
And, says Berry Everitt, CEO of the Chas Everitt International property group, the way to do this is develop an eye for homes in good areas that may not look so great at the time of purchase but have good profit potential – in other words, homes that have the “right” things wrong with them.
Writing in the Property Signposts newsletter, he says these items include the following:
A bad paint job.
You should actually consider it a plus if you find a good property that really needs painting. You can discount your offer to compensate for the painting expense and inconvenience, and, immediately the paint is dry, look forward to an increase in home value equal to three to five times the cost of the paint.
Old or uninspiring light fixtures.
Among the least expensive and most profitable home improvements are new light fixtures – and skylights to open up dark hallways, bathrooms or kitchens.
Ratty old carpets (provided the flooring beneath is sound).
Another extremely profitable home improvement you can make is to install fresh new floor coverings. Sanding and varnishing existing wooden floors is also a good option, especially if they are in keeping with the age and character of the home.
A neglected garden.
Spending even a few hundred rand on plants, lawn, and a garden clean-up often adds two to three times that expense to the market value of the home.
Buying a one-bathroom home can be very profitable if a second bathroom can be added within the existing floorspace. A second bathroom usually adds at least twice its cost to the home’s value – and it makes the home more marketable.
“On the other hand, though, you should absolutely avoid buying a home that needs a new roof, a foundation repair, a major electrical or plumbing upgrade, or repairs to water or termite damage.
“And, unless you are planning to live in the home for a long time, avoid buying one that will require additions such as a family room or another bedroom to make right for you. Such upgrades rarely add as much market value as they cost, and you are better off buying a home that already has all the rooms you need, even if it is somewhat more expensive.”
*Berry Everitt is the CEO of the Chas Everitt International property group.