Six Real Estate Investing Tips

The following collection of real estate investing tips will probably have a few things that you already know it it. That's okay. There will be a few you haven't heard before as well, and in any case, we sometimes need to be reminded of what we know.

1. Find an agent with the right experience. When selling real estate, drive around and see what else is for sale in the same area. Look particularly at the name of the agents on the signs. The agent whose name shows up the most in your neighborhood will likely know best how to price and market your property. You can also do this by looking through real estate guides to find those agents who are either active in your area, or with your type of property.

2. Make low offers correctly. When making a low offer that may offend a seller, let him know that it isn't personal, that this is just what you need to make the deal work for you. You can include a list of concerns or of things that you will have to repair, to justify the lower price. If you have a choice in a situation like this, it may be better to let the agent present the offer without you. It can be tough for a seller to hear you say anything bad about his property in person. A list of concerns is less personal, and less likely to offend him - which makes it more likely that he'll seriously consider your offer.

3. Look for "extra" opportunities. When flipping a house, you might normally look for fixer uppers that can simply be "put into good shape" and sold for a decent profit. But if there are "extra" opportunities that other investors aren't seeing, you can make even more. These are things like a full basement that can be converted into living space, or attic space that can be made into a bedroom or office, or an extra lot that can be split off and sold without reducing the value of the home much.

4. What to do when rentals won't produce cash flow. People often buy rental houses, duplexes, and even four-plexes for homes, thinking they are "investing" as well. They pay according to personal values, so these properties can be priced well beyond where they would produce cash flow. Apartment buildings, on the other hand, are priced according to one thing more than anything else: net income. The lesson? When you can't make cash flow with small rental properties, think bigger.

5. How to find motivated sellers. Real estate investors will often talk about the importance of "motivated sellers," but how do you find them? When searching newspaper classified advertising, pay attention to the wording. "Need to sell," "Must sell," and "Will look at all offers," are the usual indicators, but you can look at the rental ads too. "Must have a good job," may indicate a landlord who is tired of tenants and ready to sell. Searching county records for out-of-state owners is another way.

6. Don't rely on appreciation. If you are planning on rising real estate values as your primary way to profit, you're speculating, not investing. Recent drops in values in many areas show the flaw in this strategy, but also keep in mind that transaction costs can be up to 10% of the sales price, so you have to have a big increase in value just to break even. Enjoy any appreciation as a bonus, but buy based on the cash flow, a plan to increase the value (fix and flip), or some other well-thought-out plan for profit. This may be the most important of these real estate investing tips

A Guide to Investing In A UK Buy to Let House

Are you thinking about investing in a buy to let house? Despite the fact that the UK banking and mortgage business has been unusually volatile recently, it’s improbable that the need for homes to let will shrink is just around the corner. This means that this area will always present a potential profit through this opportunity. The question is this: what should a person look for when hunting for a nice buy to let prospect in the fluctuating economy of today?

Buy to Let House : Seeking a Good Property

Houses in excellent shape and well-situated are ideal when on the lookout for a buy to let house. However, this rule doesn’t always hold true. You might find an inexpensive house that needs a little patchwork that could also be worth your while. Just be sure to find an appraiser with know-how who can tell you just expense must go into patching up the place. A lot of the time these expenses wind up being higher than anticipated. They also consume more time than expected, meaning it will take longer for the money to start coming in.

Any House Can Be A Buy to Let

One thing to remember is that any almost any house can potentially be a buy to let opportunity. It’s not required that the owner promote the home as such. You may be able to find a house that is simply inhabited by the owner and turn it into a good rental arrangement. On the other hand, it can be convenient to find a situation where the house is already being let and you can simply collect rent from the present tenants.Under these circumstances you don’t need to find tenants or ponder over whether you can appeal to other potential live-ins.

Buy to Let: Inventive Financing

Until recently, the smart and trendy way to go was to take out an easy-to-get, good-rate mortgage.At the present, things are more difficult and the rate of interest for such investments are probably going to shoot upward. Nevertheless, you can still reach your goal of obtaining a house to let. It may come down to some creative financing.

You could come together with a property club or syndicate, where shareholders share resources. Thought this may initially seem complex, it can provide investors with chances that would have otherwise passed them by.

Another possibility is owner financing. Many house owners are very nervous and distressed about the possibility of repossession, causing them to consider providing financing.

Buy to Let UK : Opportunity Awaits Those Who Seize It

The economic news has been disconcerting over the past several months.Thankfully, in any event, there’s always a bright side for those interested in investing. Even if property becomes more tough to sell due to bottomed out home values, an investor can still come out with a positive. These days, it’s necessary to stay on top of rapid volatility in various sectors of the financial sector.Paying for a UK buy to let house is no different . Don’t let the opportunity pass by—be attentive and snatch the opportunity when it arises.

Make Money Flipping Real Estate - Which Way?

You can certainly make money flipping real estate in more than two ways. However, when it comes to actually repairing and improving a house to sell it, there are two essentially different approaches. The first is to do as much of the work yourself as you can. The other approach is to simply manage the project while others do all the physical labor.

Many investors will tell you that your time should be spent finding and managing properties, not raking leaves or painting or hammering nails. Doing the work on the house means you have bought yourself a job, they will tell you, rather than an investment. I tend to agree, but nothing is that simple. There are good reasons for either approach and you can make money flipping real estate either way.

Make Money Doing It Yourself

Do you make more or less money when you do your own work on that fixer upper? That depends on how you look at it. It is true that you might make more money on a given project. After all, if it costs $2,000 in labor for roofing, and you do it yourself, you should make $2,000 more profit - at least if you do it as fast as the professionals would have done it (there are holding costs to pay if the project is delayed). On the other hand, if you do a lot of the work yourself, you might be able to flip just a couple houses a year, rather than the dozen you could do if you paid for all the labor.

When you do it yourself, however, you do get a bigger margin of safety. (I should say you CAN get a bigger margin of safety, because those of us that aren't as skilled in the building trades might screw things up and have to hire a professional anyhow.) On a project that would yield a $20,000 profit after paying for all labor, you might save $8,000 by doing much of the work yourself. This can mean more profit, but it also means that if there are unexpected expenses or you guessed wrong on what the house would sell for, you are less likely to lose money.

Another factor to consider is your cash situation. If you are tight on cash, and you don't want to bring in other investors or you can't borrow enough money, you can get by with less by doing a lot of the work on your own. In fact, one way to do your first flip is to live in the home while you fix it. This makes it easier to get financing, and if you stay there two years before selling, you don't have to pay taxes on the profit.

Make More Money Flipping Real Estate As A Business

Handled like a business, there is no doubt that you have the opportunity to make more money. A friend of mine flipped fourteen houses in one year, something he never could have done if he had been painting the homes or laying tiles in them. He never lifted a hammer. He made it clear that he thought his time was better spent finding the next deal, while his crew finished the houses that he had at the moment.

The Choice

Which is the better approach then? It depends. Of course there is more money to be made finding deals than hammering nails. But what if you need a safe small deal to get started? What if you are short on cash and ability to borrow? What if you just enjoy the process of fixing up a home?

Those are all good reasons to consider doing the work yourself, or at least part of it. There is no absolute right way to make money flipping real estate. Often investors learn a lot by getting involved with the repairs and improvements. This could mean you'll save money and make better decisions later, when you are managing projects or finding deals. The choice is yours.

Buy Real Estate: A Set of Tips for Buying in the U.K.

Don't go blindly into an endeavor to buy real estate in the UK.  In this article, we’ll present some important information about how to find houses that are both affordable and attractive. Learn what you need to know about real estate property by reading further in this highly informative piece.

Buy Real Estate UK : Prices are Regional

Becoming a doctor takes a lot of time but buying real estate is a little simpler. Northern properties are generally cheaper than those in the south, but you still have to  check the deals Buyers should know, however, that real estate buying and prices can vary considerably, not only from north to south, but also from east to west. Here are few very general examples:

How Prices Vary

If you look at a residence or investment property in the north have about £60,000 ready for the purchase. A Semi-detached home (really a pair of homes) shares a wall with its neighbor. Their floor plans are identical, but reversed, so it's like seeing mirror images. Many suburban homes are semi-detached. The same type of semi-detached home in the southeast will cost nearly double its norther counterpart – about £110,000. Southwest prices sit in the middle – about £80,000 for that same home. Cottage style homes are in great demand. These charming homes have prices from £85,000. Fully detached houses run anywhere from £140,000 to £600,000. Apartments in the city can be very expensive, such as a starting range around £200,000 in London. Don't even look at waterfront properties unless you're fairly well to do. When buying your home keep in mind that the average cost of a residence in the U.K. Is more than £90,000. 

Real Estate UK : Location, Location, Location, Where to Buy in the UK

Favorite locations to buy real estate in London include Mayfair and Knightsbridge. For those who want a more rural or suburban setting, good choices are Devon and Cornwall in the west as well as the Lake District, Wales and Scotland. Don't make a decision about real estate investing without taking into account the cost of living. For example, a couple with 2 children can expect to spend about £105.00 per week on food and drink, about £125.00 on housing and about £35.00 on transportation. £435.96 is the average weekly bill for families once child care, health care and other elements are calculated. Although these costs can vary by location (with London and environs being the most expensive), potential buyers should consider them when reading realty listings.

Real Estate : Land is a Good Investment

There's something for everyone who wants to buy real estate in the U.K.

Bying Apartment Buildings

Buying apartment buildings is something that experienced investors often do to increase their investing portfolio and guarantee a monthly income over a long period.  Apartment buildings may be too expensive for the beginner, but their profit potential make them a wise choice for those who can afford them.

There are mainly two different types of apartment buildings: the garden apartment complex or the multi-level building.  The garden apartment complex can be found in any city or town and is characterized by small apartments grouped together.  These could be duplexes, townhouses, or another structure that is only a few stories high.  A high rise contains a number of  apartments in one building and may have an elevator.

Garden apartment complexes are widely available and can be found for an affordable price.  Since they cover a wider area of land and are typically multiple buildings, the maintenance costs for these can be high.  Also, more landscaping is usually required.  Many garden apartment communities have other amenities such as laundry appliances in each apartment and community play areas.

High rise apartment buildings generally aren't  found in smaller towns, so you'll need to be in (or go to) a city to buy one.  They tend to be higher in price than garden apartments, but this is offset by the fact that maintenance costs are usually lower. However, depending on the area that you live in, you might not have as many to choose from.

If you are interested in buying apartment buildings, start by looking at what is on the market for sale.  You may search online, use the classifieds, or deal with a realtor or broker specializing in apartments.  You might find an apartment building that meets your requirements with just this method of search.

It can be more difficult to buying apartment buildings that arentt yet for sale, but it will increase your options and lower your competition.  Ask owners if they are interested in selling.  Have a confidentiality agreement prepared before going to the owners and if they will consider selling, study the books closely.

When buying apartment buildings, you need to have all the facts.  Find out the type of renters for the units, the price of rent, the occupancy rate, and the income and operating expenses for the past few years.  You'll want to draw up a confidentiality agreement to give to the owner before you contact him. Buying apartment buildings takes diligence, but it can be a wise investment that will pay you for years.

Can We Get Real About U.K. Real Estate?

A recent report about real estate in the U.K., especially properties located in or near London, contends that flat local real estate prices and a depressed market is at least in part due to the fact that sellers as well as real estate agents may have unrealistic expectations regarding the selling price of their properties. Sales are down near 50% which means the price of homes for sale is falling. Sellers are rejecting a lot of offers, which further fuels the situation. There's often a 30% difference between the value expected by the seller and the price the buyer is willing to pay. A seller who’s asking £100,000 for a UK real estate property and receives offers in the range of £70,000 is highly likely to reject them.

Sellers Are A Major Part of the Problem

Owners aren't listening when real estate brokers tell them their property value has fallen. In fact, property values in the present market can decline as much as 20% annually. One expert in real estate services places the blame firmly on the sellers: “As a result they [sellers] are unwilling to accept agent advice on appropriate asking prices or offers. Consequently, many properties are withdrawn from the market or remain unsold for long periods, producing an unprecedented low number of transactions. Unless their [sellers] properties are absolutely outstanding it is essential that they [sellers] adopt a realistic attitude and listen to advice if they want to achieve a sale.”

Costly Real Estate is Suffering Too

Another shocking aspect of this trend of UK real estate is that even high-end properties designated as “super prime” are not immune. Super prime properties are those valued at over 10 million pounds. Foreign investment helps slow this process, but any real estate agent will tell you values are still moving lower. Rental prices are also dropping as more and more super prime properties flood the rental market.

Lenders Are Partially to Blame

Mortgage rates continue to move up even though many banks have requested bail outs from the government. Also, when interest rates drop, the lower rates are not being passed in to consumers, such as when the Bank of England recently their rates from 0.2% to 0.5%. The banks justify raising their rates in the face of lowering national rates by saying that all the banks are doing it. Despite this, lenders like Lloyd’s TSB and Barclays’ in fact raised the Bank of England’s new lower rate. Whether or not this is true, it’s still bad news for real estate in the U.K. And it’s even hurting news for consumers who are seriously looking to buy UK real estate.

How to Benefit From buying Overseas Property

There are many profitable opportunities for UK investors in the overseas property market. There is a constant change in the status of various areas; however, if you look for the best buy according to your budget and necessities, you will be successful in attaining a workable property. These are some tips to assist you in successful purchasing.

Locating Overseas Property UK

There are many avenues for searching for sales on overseas property. It may be as easy as searching on line or seeing a periodical or newspaper ad. You can often find better values if you look closer to the place where you want to invest. You could look in local publications, or even visit the place and search for signs outside properties. It may help to ask questions about properties on the market if you happen to know (even vaguely) anyone who resides in that neighborhood. Hearing people talk about it is sometimes the most efficient method of locating something because you may hear about a property for sale before the sale goes public.

There are global real estate consultants that can help a particular to investor to search for property in any area. The benefit in going through this type business is that they are knowledgeable in all facets of overseas investment; they can steer you through the entire ordeal.

Know All About The Real Estate and the Surrounding Area

Prior to purchasing overseas property, make it a point to be completely knowledgeable about the real estate and the community. Be especially mindful of things that have significance based on the purpose toward which you are leaning. For example, if you want to let the property to tourists, be sure that it is convenient to an airport, shopping, and, if it's a seaside spot, the beach. Also, know the year round status of the area. If possible, visit it several times during different seasons.

Financing Overseas Property

You can finance an overseas property in a variety of ways. You may go to a loan company in your area or even one in whatever overseas country in which you are making your purchase. Sometimes it will benefit you to borrow through an intercontinental mortgage lending company. These companies know about taxes, rules, and laws in various countries and also area familiar with foreign languages that you may not understand.

One May Desire to Have A Lawyer

Perhaps you would like to obtain a lawyer who is familiar with the condition of the neighborhood where you want to purchase the real estate. This depends on how comfortable you are with the process. If there will be no lawyer assisting you with your purchase, you must know all the tax rules, the laws, and the regulating procedures in the country.

There are unforeseen obstacles that you as a new investor could stumble upon. For instance, in Spain, one may invest in a “gray zone” or an uncertain property area; although a person is allowed to buy the property, he may be forced off the property so that another development can be put there. If you have any uncertainty, you may end up saving money and trouble by seeking legal advice.

These helpful hints can assist you in gainful investment in overseas property. Do careful research of the worldwide real estate marketing prospects and you will happen upon a profitable investment choice.

Acquiring Off Plan Property

Those of you who are property investors have likely heard of making off plan property acquisitions. Though this type of real estate investing can be risky, purchasing a property that has not yet been constructed but only at the drawing board can be very rewarding. It’s not even necessary to go to the building site—you can simply buy it at the onset. The majority of developers are constantly searching for other finance resources and will present buyers with striking return rates and incentives for investing in an off plan scheme.

What Questions You Must Ask Before Dealing  an UK Off Plan Property Investment

First, you must be sure that developer will not sink - neither should his project. But how can you be sure?  That’s the key, isn’t it? It’s easy… examine both his record and the details of the specific project you’re interested in – that should clear things up. The next inquiry you should make is whether your deposit goes to him or a neutral third party to hold onto. Another important facet is determining the developer’s previous success rate. Our focus now shifts to set-up parameters for the project. So what happens if the building phase ends prematurely or doesn’t meet your quality standards if you’re an overseas investor?

Can the property be resold prior to the final stages?  Will this incur an added expense?  There are yet more questions left for property management corporations to ponder. Finally, smart businessmen will consider things like the payment timetable, the overall effort involved in the purchase, apartment off plans, cost of setbacks, returns on letting, and taxes.

Perks of an Off Plan Property

For one thing, you’re getting to buy the property based on today’s finances. You can start raking in extra revenue based on its inflated value once you’ve tied up the necessary loose ends. When everything’s wrapped up, this means you’ll end up with a concrete building worth two times that of the original off plan price.

Offplan UK : More Pluses to an Off Plan Investment

The market value payoff can be quite substantial for those who get involved in buying off plan property. Payments on the development can be lesser since it will take a while to actually complete the project. This gives you the ability to save up and give you time to pay only when needed and make the most worthwhile property investment. A shocker when making a purchase on off plan homes is that you are not required to pay for the off plan development completely. Instead, the investor can simply make themselves a seller and resell the very same property they’re buying.

Best Investment Properties

Whether you are just starting out in investing or are looking to add more properties to your portfolio, you want to find the best investment properties.  Before you start searching, you want to make a list of your criteria--are you looking for a residential or commercial property?  Do you want a house to use as a rental, or are you hoping to make your money by selling it?  Are you planning on living in the home while renovating it, or do want to flip it for a quick profit?

Even though there are many investment opportunities in real estate, you should always strive to have an investment that will pay for itself, one that has the potential to increase in value, and one that is a good fit for your lifestyle and resources. No one house or commercial property can the best investment property for everyone.  Take stock of your needs before you begin.

If you are interested in purchasing an existing business property, find one that is successful.  Don't get distracted by failing businesses with the promise of potential.  Look over the books, check existing obligations such as lease agreements or restrictive covenants and ask the owner why they are selling, and ask yourself if you have the ability to run the business.  If the success of the business depends on expertise you don't have, walk away unless you know you can get the right people working for you.

Multi-dwelling structures, such as garden apartments or a high-rise can be some of the best investment properties.  These tend to be more expensive than single family homes to buy,  The monthly income can be potentially greater, but so can the operational costs.

Small apartment buildings grouped together won't be cost as much as a high-rise, but will have high maintenance needs.  A single family home is often a good start, but will need a high rent to make it profitable.

Some of the best investment properties, especially for beginners, are undervalued single family homes that you fix up and resell for a profit.  This is commonly known as house flipping.  For those with little money to invest, living in a home while fixing it up is a good option.

If you don't have the time and money for a quick flip, consider living in a home while fixing it up for a few years.  This isn't as fast as house flipping, but it is a nearly risk free way of investing in real estate.

Success Tips for Turning a Profit with Your Investment Property in the UK

You may have heard that owning an Investment Property in the United Kingdom can be lucrative. It turns out such speculation is true. Real estate investing, such as flipping real estate and rental real estate investing is amongst the most profitable investments around. Doing this sort of investing consists partly of making an investment in som type of property, perhaps a vacation property. Once this is accomplished, your goal is to turn a profit in order to boost your revenue.

Choose Your Investment Property Type

The two kinds of property that exist are commercial and residential. The broad definition is any property that people live in. Included in this definition are apartments, houses, mobile homes, and the like. Some examples of commercial properties include shopping malls and offices. Some places, such as apartment buildings with a store on the bottom level are considered commercial.

Making a Decision on a Vacation Property

Vacation properties are a great choice when it comes to buying an Investment Property especially if you purchase it in a coveted vacation market. You’ll find that there are many differerent kinds of vacation properties. A hotel – or perhaps a bed-and-breakfast – might be properties you take a look at. Or, you can buy a home or cottage property or a beach investment property which you can then rent primarily to vacationers. You should take note of places where rental properties are more seasonal than in other locations. If you set up a strong gameplan, then you can stay solvent during lean months.

Nothing More Important then Planning Ahead

Putting planning first may be the key to success for those who invest in real estate. Before you even buy a property, there needs to be a load of research and analysis. Planning is possible thanks to a host of individuals like a lawyer, financial advisor…perhaps a listing agent. Boost your portfolio by getting that first property to turn a nice profit.

Profit Portfolio

Those who have diversified portfolios tend to be among the greatest successes as real estate investors. This means that they have a combination of different properties which are all making them a profit or have the potential to do so. The ultimate real estate portfolio will include a combination of residential and commercial properties as well as land. Such properties wiil not be placed into a lone market. Peoplke may possess global income properties. And to think – everything originates from that very first property you purchase.

Choosign to focus o neither residential or commercial properties is no problem. There’s no issue with diversifying either sort of property. Take, for example, profiting from commercial investment property – simply allow a new investment property to also be commercial in nature. You definitely will benefit from broadening your finances rather than keeping your money in a singular place.

Getting The Most Money Making Via A Property Investment

First Moves

You can always learn something new from estate investing – even if you’re an old hand at investment. To attain a strong property portfolio, you have to relly look into the properties you want and choose wisely. To get firsthand experience in real estate investing you could start by working with a property investment company. Many property investment portfolios have been launched this way.

Putting Money into your property investment

The reason we bring this up first is due to its importance. In order to know your finances, you should be doing business with those specially trained to help you in this category. Given the importance of this initial phase, you should put things in the hands of eager pros who want to help. These professionals are financial advisers; mortgage brokers and finance experts who can help you get some of the best deals on your financial requirements. If you want to complete that first step on your investment journey, getting your books in order is the way to go.

Register Yourself to a property investment club

If you are good at residential property investments and would like to increase your profits then property clubs are quite lucrative. The opportunity to learn from those with success in property investment can be the greatest reward of joining an investment club. Over a period of time you will network with some heavy-duty investors at the property investment seminars that are held by such clubs.

Reasons for Clubs

Overseas opportunites and consultation experience are two of the many benefits to being involved with members of property investment clubs. Not only can you take advantage of local opportunities – but there is a whole new market opened up to you overseas. Membership in property clubs can provide you with deals of a lifetime.

Being a Part of Property Management Companies

If you are not satisfied with the property investment appraisal that investment clubs offer, you can also try your hand at property management companies. Key to those who dabble in these companies is the fact that they have experience in rental investments. The rental property business is very profitable but carries a fair amount of risk. Commercial and residential real estate are each components of rental investment.

Odds and Ends

Getting profit from residential income property comes from flipping properties and leasing buildings with off-plan investments. With a smart financial plan, you can make money flipping real estate investments and finsh off deals. Being knowledgeable regarding real estate is key, as is locating eager sellers. If you want lots of profits, then you need to correctly pitch your property following the deal.

Utilizing Property Management Companies

For those who don’t get maximum benefit from property investment clubs, they can always turn to property management corporations as another option. Rental investment experience is a major component of what you get out of management companies. The rental property game offers great rewards…but some risks, as well. Included in rental property investment is residential and commercial real estate .

Fixer Uppers - Five Steps and Two principles

Most new investors in fixer uppers have the basic idea that you buy a house in need of some repairs and cleaning, you fix it up and sell it for a profit. That's a good start, but how do you know if there will be a profit, and what changes to make? Many investors have lost money on their renovation projects, after all.

You have to have a clear idea of the profit potential before you make an offer on a house. How do you do this? Try the following five steps.

1. Make a plan for repairs and improvements.

2. Determine what the house will sell for when it is ready.

3. Estimate the total expenses for repairs and all buying, holding and selling costs.

4. Decide what you would like for a profit for the project.

5. Subtract all projected expenses and your desired profit from the estimated selling price. The resulting figure is the most you can pay for the house if you want a safe investment. You'll want to make an offer lower than this to leave room for negotiations.

That's the safe formula for fixer uppers. It is much better than the "intuitive" process that loses so much money for unprepared investors. But it doesn't answer the question of what repairs and improvements to make. There are two important principles to consider when deciding that.

Fixer Uppers - What To Fix

The first basic principle is to do those things which pay the most for the money spent. It can be easy to put more into a fixer upper than you can recover, so you want to choose those repairs and improvements that do the most to increase the value of the property. For example, painting kitchen cupboards might cost you your time and $25, or $125 if you pay someone to do it. They may look new as a result, and so add $1,000 or more to the selling price of the house.

Actually installing new cupboards could cost $6,000 and add only $6,000 or $7,000 to the home value. In that case, the painting is clearly a better value. Of course, there will be times when the new cupboards make more sense, especially in some high-end homes. Do the math.

As you consider the options you have, always think of return on investment. You may need the help of a good real estate agent to determine this. Describe the house with all your planned changes done and see what an agent thinks it will sell for. Try another set of improvements and see if that has a better return. As you gain experience you'll know what buyers in your area value, and so what changes will pay the most. And always look for all the simple high-return improvements, like a new mailbox, a few flowers and a thorough cleaning.

One thing not mentioned yet is the cost of time. Some repairs and improvements add not just the cost of the change itself - the materials and labor - but also add to the time the project takes. Every day that goes by you are paying for interest on loans, electricity, heating, water, insurance, property taxes, and other holding costs. You have to take those into account, which brings us to the second principle: As much as possible, do those things which make the fastest return on your investment.

Suppose new windows are a possibility, and will add about $8,000 to the value of the house, while costing you $6,500. It seems that you make a profit on the investment, but what if they cannot be installed until a month after the rest of the repairs and improvements would otherwise be done. If your total holding costs are over $1,000 per month, you are probably cutting it too close and you might want to drop the new windows from the list.

It isn't just the direct holding costs either. If you turn over your fixer uppers quickly, you can make more money. There are only so many projects you can handle at once after all. If you concentrate on fast fixes you might get six houses done in a year instead of four. If you're making $15,000 on each that means $30,000 more per year. Keep that in mind the next time you try to squeeze an extra couple thousand in profit out of a project, but at the cost of a month or two of your time.

Make high-return repairs and improvements, and make fast ones. That is the basic idea. And though you'll never know for sure exactly how much value a given change will add, or even what it will cost, estimate as best you can (and get help when necessary). Perfect projections are not important for making a profit with fixer uppers. Following the right principles is.