Fire damaged homes can represent a good opportunity for an investor. If you are one, it is expected to be on the lookout for homes that you can make a profit from. However, people tend to stay away from homes that have experienced fire damages due to some understandable reasons. So, how can you make money from a fire-damaged home?
First of all, there are certain rules to adhere to before one can start making money from a home that has experienced fire damage. Some of the necessary things to have at the back of your mind before benefiting from a fire damaged house are:
Knowing the rule
There are several rules one is expected to know before making money from fire damaged homes. The first thing to know is that it is not a hobby, rather a business. This is why it is important to be well-informed and have some follow up with the contractors who are in charge of managing the house and also other professionals involved with the building. Furthermore, it is expected to know the law governing repair and other aspects to limit or better still avert future lawsuits. Imagine not getting the right personnel or contractor for such a building, and after selling such a building for a higher price, you are then faced with a lawsuit. This can be draining financially as you can get sued for not doing a good job and selling a substandard house.
When people talk about purchasing an item at a low rate and then selling it for a higher price this is what is expected here. This act is not limited to only the stock market or other goods and services. Real estate investors are encouraged to purchase houses at a cheaper rate and then have those houses sold for a more improved profit. But on homes that have experienced fire damage, it is of utmost importance to have this activity done. The reason being that, when you purchase such homes for a cheaper rate, it would allow one to conduct proper repairs on the property as well as keeping the profit potential in check.
Have the property inspected
Inspection is very essential especially when it involves a home in such a situation. This is why there is a need to have a professional inspect such homes before and after repair. The reason why you need a professional to have the home inspected is to enable them to check if the home meets both the local and federal standards. The expected thing to do is to have a photo of the damaged parts of the home. Also, they should look for damages on the water, soot, and smoke. A certified inspector is expected to look at not just the structures, but as well as several areas of the house, such as the ceiling, the beam, the walls. The whole essence of having this done is to have a proper examination to determine if the house is irredeemable.
Have the house cleaned up and repaired
Once you have been successful in knowing the extent of the damage, it is then expected that you have professionals to start working on those damaged parts and have them cleaned up. This isn’t a task one can decide to take on even if there is some level of understanding on going about it. There is a need to have a certified or qualified contractor employed for this job. Some houses may have a basement, and as such, it won’t be harmful to have a few feet of water in that area. To eliminate odors, they may have to tear down the walls. Also, certain parts of the building might have to change, whether it’s been damaged or not. Places such as the ceiling, the windows, and doors, the plumbing systems, etc. With so many repairs and replacements, it is important as discussed earlier that such homes be bought at a cheaper rate.
Appraise for value
Before you appraise for value, the home should not just be inspected, but also cleaned and repaired. If the house was purchased at the appropriate price, and after undergoing the necessary repairs and maintenance, then the value of the property may be significantly higher to attain a healthy profit margin. Using a certified appraisal would help you in getting the right value for a home such as the one that has undergone such repairs. Also, it should be made known that it is very much possible to see a 50% profit margin on such homes.
This is the last point and one that attains profit. Fire damaged homes after being worked on properly, should be sold for a good price. That way, profit can then be realized. It wouldn’t be beneficial in any way when, after repairing such a damaged home for lots of money and selling it with relatively no profit. This is not how business is done or conducted, and as such, it should not be followed in any manner. Therefore, it is important to have such homes sold at a high rate.
Lastly, fire or accident may occur in a building which is quite a bit normal and somewhat unavoidable. But it is possible to prevent such incidents from happening. Most homes have fire alarm systems installed on them, and this prevents the home from being damaged.
Moreover, it is very much possible to make money from a fire-damaged home. With this guide explained above, and by hiring the right services for the job, there is no reason why you can’t make a profit from such homes. Furthermore, as a real estate investor, buying such homes at a cheaper rate cannot be overemphasized as when you factor what such buildings have to go through before being deemed fit to sell. This is why it is important to make a profit by buying it cheap and then selling it at a higher price.