ResidentialPropertyInvestorsClub.com

By far the most surefire way to begin building wealth quickly through residential property investment is to buy ugly but structurally sound properties and quickly turn them into beautiful swans. The aim then is to have the property valued, therfore creating more net wealth, and to then rent it out for top dollar to assist with the holding costs. You can then repeat the process over and over to build quite a large and very valuable portfolio.

Tenants will pay a lot more to live in a home they are proud to show off to their family and friends, and will usually care for that home much better than they would living in a more dated or run down dwelling. Recently I increased the rental of one house in my portfolio from $275 to $450 per week, and the value was increased by $155,000 by outlaying $34,767, thats $120,233 net profit for an average Queensland house purchased for $360,000.

The two most important factors worth considering when undertaking a renovation are time and money. The longer you take to finish a project the more money you will waste as your holding costs are way more significant without rental income. If you spend too much money on the reno you will run the risk of over capatalizing, which means spending more than the increased value achieved. 

The best time to renovate a property is when you first purchase it. Spend the money where it will have the most effect and do not fall in love with the most expensive fitouts. Always keep in mind the name of he game, and that is to create wealth, it is not to provide your tenants with that crystal chandelier or gold leaf trims that you always wanted. When a valuer walks through it doesn’t matter as much to him what you have spent, but what does matter is how fresh, clean, and spacious the property feels. With these considerations in mind you will have a greater chance of achieving a larger return on the dollars that you spend.

In upcoming articles I will be taking you through the procedures and giving tips on:

- how to conduct a profitable renovation.

- dealing with, lining up and finding the right tradies.

- value adding do it yourself projects.

- and how to get the best possible valuations so so the bank will let you do it all again.