If renovating properties is your passion, there are ways you can turn it into much more than a hobby. In fact, if you know what you’re doing, renovating properties can become your full time job.
Three ways you can turn your passion for renovating into a money-making job are; flipping houses, renovating to rent or becoming a renovation professional. We take a closer look at each option below:
Someone who flips houses will buy a run-down property, do it up, and then sell it for a profit. It sounds simple enough but it can be a high risk move and not something you should do unless you have a solid understanding of the property market as well as renovating.
The aim of the game with flipping houses is how fast you can turn around a renovation after purchase, and whether you can keep it within a strict (and fairly low) budget. Once you have purchased a property that you intend to flip, you need to move fast. Get same day skip hire and get to work. A home that you are only doing cosmetic changes to should not take more than six weeks to complete, and should not cost more than 10% of what you spent on the house price in the first place.
There are risks involved in flipping houses. The main risk being that you might not be able to sell the property at all once you have finished renovating it. This will mean you are left with the full mortgage, as well as all of the bills from the renovation work. Or you may sell the home, but not for a profit, meaning you won’t have money to pump into your next renovation project. With all of the right knowledge and tools, you should be able to minimise these risks significantly.
Make sure you do a lot of research before you buy anything. Watch the market closely, especially the particular suburb you are interested in, so you know the highest and lowest price range you’ll be buying between.
If you are handy with a hammer and can do a lot of cosmetic fixes yourself, you will save money on labour costs, meaning more of a profit margin for you. For any of the specialist jobs, such as electrical or plumbing, you need to leave this up to the professionals.
Renovate to rent
A less risky investment option than flipping houses is to buy, renovate and then rent. You can save money on taxes and if you have someone renting your place and effectively paying the mortgage on it, you’ll be freed up to get started on your next renovation property.
The same basic principals apply for renovating to rent as with renovating to sell. You need to be fast with the renovations, because until you get someone in there renting it then time is literally money as you are making the repayments on the place by yourself. You also need to do the due diligence with your research into the suburbs you are interested in, as well as the demographics that may be interested in them. If it is a family-friendly suburb, you might want to find a place with a child-friendly backyard. If it is a suburb that attracts working professionals, you’ll need to look at places close to transport into the city.
Once you have bought the property, it is time to do a big clean up. Hire a skip bin and clean out the entire yard as well as anything that needs cleaning out from the house, such as old bricks or tiles. Once that is done, a quick coat of paint and some simple fixes such as changing door handles or light fittings can make a big difference to the overall feel of the place.
Be very careful not to over-capitalise with renovations for renting. There is only so high your rental return can get before people simply won’t pay the amount you’re asking for. So spending hundreds of thousands of dollars on a renovation won’t help you make your money back.
If you’ve done your fair share of renovation projects and have decided that not only do you have a flair for renovations, but that you love it, there are options for doing it as a professional job.
Aside from doing a trade, there are other ways you can work within renovations full time. You can become an interior designer, or a kitchen or bathroom designer, a stylist or even a buyer for a home wares or renovations chain.
If you are really into flipping houses and think you have something to teach, you could become a mentor in the field and help guide people through their first renovation. You could start up a website and even write a book filled with your tips and tricks on how to renovate for profit. You never know where it might lead you!