How to Rehab a Property in 7 Steps

So, you've decided to foray into the exciting world of rehabbing properties? Well, congratulations! This is one of the most lucrative real estate strategies available today. However, it's important to understand that rehabbing is complex and fraught with risk. That's why we're here to help! In this article, we will walk you through the seven essential steps for rehabbing a property. We'll provide an overview of each step so that you can get a better understanding of what's involved. Follow these steps and you'll be on your way to successful rehabs in no time!

Step 1: Scope of Work Development. This involves creating a list of all the tasks you need to complete in order to make the property habitable again. Make sure that you are realistic and thorough when it comes to defining your scope of work - this will help you avoid any costly surprises down the line.

Step 2: Job Bidding and Contractor Selection. Once you've created your scope of work, it's time to find contractors who are willing to do the job for you. You can either put out a call for bids or contact contractors directly. Make sure that you thoroughly vet any potential contractor before hiring them—you don't want any unqualified people working on your property!

Step 3: Contract Communication at Signing. This step involves signing a contract with each contractor agreeing to the terms and conditions of their employment. It's essential that you take this step seriously, as it lays out all of your rights and obligations as an employer. The contract should also include payment schedules and completion dates so that there is no confusion down the line.

Step 4: Six Critical Documents. You will need to provide six critical documents to contractors before they can begin work on your property. These include waivers of lien, payment authorization, an agreement to purchase materials and services, a release of claims form, and finally a certificate of completion.

Step 5: Managing the Rehab Process. This is where you'll be most involved in the process as it involves actively overseeing the progress made by each contractor. Make sure that tasks are completed according to schedule and that there aren't any unexpected costs for materials or labor—these types of issues can quickly add up!

Step 6: The Property Closeout. Once all of the contractors have finished their work, it's time for the property closeout. This involves making sure that all of the necessary paperwork is in order, such as releases of lien and certificates of completion. You'll also need to inspect the work yourself to ensure that it meets your standards before giving final approval.

Step 7: Preparing to Sell. The last step in rehabbing a property is preparing it for sale. This includes cleaning up the property, making any necessary repairs or upgrades to fixtures or appliances, and staging the home so that potential buyers can get a good feel for the space. Then you'll need to set an asking price and market the property—from there, it's just a matter of finding the right buyer!

By following these seven steps for rehabbing a property, you can ensure that your project runs smoothly and is completed on time and within budget. Good luck!

Hello! I'm Jay Thomas, a REALTOR in Houston, Texas. Chances are you and I share a similar passion, Real Estate! I also have a passion for building businesses, working out, inspiring others, technology, sports, and people. Connect with me on Facebook and Instagram!