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Updated about 16 years ago on . Most recent reply

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Sam Green
  • Real Estate Investor
  • Delaware
10
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158
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How much to spend on a rehab

Sam Green
  • Real Estate Investor
  • Delaware
Posted

I'm looking at both duplexes and rehabs. My question is focused on the rehab arena. What is the most I should be spending on a rehab? Not in cash terms, but in percentage terms. If I find a SF home that is in need of work, does it matter how much work it needs? I'm assuming all that is important is how much profit you can make, but I wonder if there are projects with too many problems. Are these worth investing in or avoiding?

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Scott M.
  • Real Estate Broker
  • Rochester Hills, MI
2,021
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Scott M.
  • Real Estate Broker
  • Rochester Hills, MI
Replied

I really do not look at it in terms of a %age as really only care about overall cost and whatever formula I am using for that particular exit strategy.

having said that I will walk away from a home if it needs structural work or a total gutting - not because of the cost or time but because there are easier ways to make money in today's market.

In a tight market maybe - but in todays market there is no need.

So to answer your question direct - no I do not use a %age but only consider the overall cost of acquisition / holding etc....

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