Buying to Renovate: What Your Clients Need to Know!

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Education & Training with The Lones Group, Inc.

The Lones Group, Inc.

Buying to Renovate: What Your Clients Need to Know!

Many buyers are finding themselves having a hard time purchasing the type of home they initially began searching for. Often they are faced with a decision to alter their criteria and even their price expectations. Many areas are experiencing severe inventory shortages, leading some buyers to make the decision to remain in their homes and renovate OR to find themselves buying something that isn't quite perfect now, but they plan to make it perfect for them through renovation.

If you are helping a buyer with this sort of plan in mind, they may need some help planning their upcoming renovation. Here are some things your buyers should keep in mind:

  1. REALITY CHECK
    Before you ever spend a dollar or lift a hammer you have to evaluate if you have the "stomach" to handle a renovation. If you remain living in your home while you are renovating, then you will be faced with some level of chaos. Certain personality types do not do well with chaos. There will dust and displaced household items and unfinished walls, drywall and flooring, some people just can't handle that kind of environment. Therefore, a buyer may want to complete the renovation before moving in.

  2. VISION
    A great renovation starts with a list of the things the buyer would like to see changed. The list then needs to become visual. I recommend putting together a vision board or PowerPoint of photos you like from sites like Houzz or Pinterest. This is an excellent idea because there is no better way to convey exactly what you want than by showing a photo of the type of changes you want. I call this the Renovation Style Guide.

  3. RESEARCH
    Once your buyer has the vision of what they want, it is time to find out approximately what those types of things cost. Perhaps it is a built in coffee machine and steam oven in a kitchen that has grabbed their attention or a rain showerhead. It is easy to find out the approximate prices to purchase these items. But there is also the cost to install and to operate. If you or your buyers are dreaming of a 10-foot-long island, there is an expense to fabricate a slab so large. By far the biggest mistake people make when renovating is that they do not allow enough in the budget to do what they initially want to do and they end up having to cut out some of the main things they initially wanted in their renovation.

  4. PROPERTY/SITE ANALYSIS
    Before a contractor is hired, do a thorough analysis of the home site. Is there anything on the site that could be a restriction from doing the type of renovation desired? Make sure the title report is checked, but also contact the local city or county planning and licensing department to find out what permits are required.

  5. MEASUREMENTS
    A critical part of budgeting includes accurate measurement. Everything from cabinetry, countertops, and even drywall needs accurate measurements in order to accurately budget for these items. There are many local companies and even large box home improvement stores that offer measurement services. Take these measurements everywhere you go.

  6. TALK TO THE PROS
    Before you decide to move an island that has plumbing and electrical, determine that is even possible by talking to a professional. The pros will provide time- and money-saving tips to enhance your project. And never talk to ONLY one trade. You have to talk to at least two plumbers or electricians to make sure you are getting the best rate and the best fit for your personality type.

  7. SETTING YOUR BUDGET
    When working with professionals on a remodel it is critical to discuss both time and money. If a kitchen cabinet company is promising they will have cabinets built in six weeks, ask them what the price will be if they miss that deadline. This will keep everyone on track and will let the vendors know that time is important. Always pad the budget with at least 15% on each item. Yes 15%! This allows the extra room needed to do it right and to allow for unexpected challenges. Every renovation has unexpected challenges. Challenges can be opportunities in disguise.

  8. SET THE TIMELINE AND BE PREPARED
    Before the renovation, create a progress book. A progress book is the TIME diary of the renovation. Take daily, yes DAILY, photos of the work that has been done that day. Track the timeline of everything that is being done, especially for projects that overlap.  The progress book can come in handy in the event there is ever a dispute about the quality of work. Imagine a plumber doing some work that ends up being problematic. The photos can be a wonderful way to show the steps the plumber did to complete the job which could help down the road. There may be some clues in these photos that show what could have gone wrong. It is also an excellent way to keep everyone honest and to keep the quality high. I actually take video of any important renovation moments like a beam being put up or a kitchen being demolished. These are also wonderful memories for later.

Making the decision to renovate takes more thought than just envisioning the finished project. Research and investigation are the most important parts of any renovation. By being prepared and by doing the homework you or your buyer will be richly rewarded when the renovation is complete.

 

By Denise Lones CSP, M.I.R.M., CDEI - The founding partner of The Lones Group, Denise Lones, brings over two decades of experience in the real estate industry. With expertise in strategic marketing, business analysis, branding, new home project planning, product development, and agent/broker training, Denise is nationally recognized as the source for all things real estate. With a passion for improvement, Denise has helped thousands of real estate agents, brokers, and managers build their business to unprecedented levels of success, while helping them maintain balance and quality of life.

The Lones Group, Inc.
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Topic:
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Tags:
planning
renovation
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preparing to sell
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Harry F. D'Elia
RentVest - Phoenix, AZ
Investor , Mentor, GRI, Radio, CIPS, REOs, ABR

Many people over spend on the renovation compared to other homes in the neighborhood has been my experience.

Sep 30, 2016 03:38 AM #1
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Will Hamm
Hamm Homes - Aurora, CO
"Where There's a Will, There's a Way!"

Hello Denis Lones,  Great blog on the subject and onethat more people should be reading up on.

Sep 30, 2016 03:47 AM #2
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Belinda Spillman
Aspen Lane Real Estate Colorful Colorado - Aurora, CO
Colorado Living!

These are some great tips for rennovating.  It is also good to keep in mind what buyers like and not just what you like.

Sep 30, 2016 05:53 AM #3
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Denise Lones

CSP, MIRM, CDEI - Real Estate Coaching & Branding
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