As most of you know, as the price of the home goes up, so goes the expectations of your tenant/buyer in regards to the condition of the home.
If you are investing in $100,000+ houses, you need to not only make the home habitable but also add eye-appealing features. Brand new carpet is expected when the original flooring is simply a little worn. Older cabinets that are in good condition are replaced with brand new cabinets. You’re worried about the “layout” of the home being pleasing to your tenant/buyer.
Let’s just say that I am glad that I invest in affordable housing. Major repairs to the heating and air, electrical, sewer, water, and roof are always going to be necessary to fix, but the minor repairs are typically not a concern as most of our tenant-buyers can take care of these issues or will overlook them.
Not having to concern myself with these minor details helps keep me focused on the more important parts of the business. And by more important parts, I mean the aspects of the business that bring in the most money.
Everytime we buy a new property, it’s worth potentially tens of thousands of dollars in profit. It can seem silly to worry about these minor details of your business that are worth in the hundreds of dollars range when you should be spending the most time on finding more deals to buy and raising more money to fund these deals.
Slightly off topic but driving the point home, sometimes my business partner/dad and I disagree about how to handle different parts of our business, especially when it comes to our tenants who are behind on rent or who aren’t following the lease, but normally I’m reminded that this is an issue that costs us in the hundreds of dollars range at the most. Yes, we need to address and remedy the issue but not spend too much time on it.
Getting back to the topic, as long as we are providing our tenant-buyer a safe and habitable house, I can sleep well at night. It’s up to him to make the house feel like a home anyway, not me.