For some folks and seasoned rehabbers, these suggestions go without saying. But to others, I hope this is helpful. Certainly, it's worth factoring in.
1)Think small - Much of your capital improvements will be based on the size of the home. For example, a new roof will be calculated by the required squares of shingles. HVAC calculations will be rooted in cubic feet. So many scopes and trade estimates will be arrived at based on square or lineal footage. So, if you're just getting your feet wet, smaller is safer.
Of course, the sales price will be based on square footage as well, but I'd rather have a small house to sell in a great neighborhood than a mansion that less buyers will be able to afford. The bigger, more expensive house will help the comps more on houses that are smaller.
2) Consider the School District - This is easier said than done because these sorts of homes will potentially be in short supply, and even a pig's ear will be come with a high dollar list price. However, if you can get your hands on the right house, success will be much more likely if the designated schools are well regarded. If/when you ever become the seller, it'll be easier to connect with a buyer if you're in a zone committed to educating its kiddos.
3) Remember Storage Space - From the beginning, a first-time home renovator should be mindful of the value of a garage, shed, or barn to store materials, tools, and equipment during a rehab. Plus, when the trades come in, you'll want your stuff out of their way so they can be safe and efficient in carrying out their designated scopes.
And if/when you move in, you will be glad to have some place to park, store bikes, yard equipment, decorations, etc. I've yet to hear someone say, "This house just has too much extra storage space."
This is going to come off as sexist, but in my experience, when potential buyers are sizing up your goods, men seem to appreciate storage space more than female buyers. Bathrooms and kitchens sell houses, and a garage or barn can seal the deal with the dudes.
4) Go for the Worst of the Best - Keep your eyes open for a run-down home in a nice area. More than once, I've invested in the worst house on the block, and sometimes the entire neighborhood. When you do this, there is no place to go but up because all the surrounding home values will help yours.
Side note: Most don't want to own the ugliest house on the block. I'm always pleased to see others step up their game when I start making noticeable improvements to the local eyesore.
5) Lock down you Pre-Approval - Hold off on a serious search until you know what you qualify for in combination for what you're comfortable investing in. I've been surprised by lenders willing to assign me more than I expected or needed but also be humbled by rejections. Before you find the perfect house, officially determine where you stand.
Happy house hunting and renovating.
