What To Look For When Rehabbing Older Real Estate
Rehabilitating older real estate can be a good investment for both the landlord and the homebuyer. Multifamily real estate, single family properties and even commercial properties could have been built in the early twentieth century or even before. This can give the real estate charm and features characteristic of the building styles from those times, but it can also present challenges for updating, renting or selling the property.
Modern Electronics in Older Homes
Older homes just were not built for modern electronics like home entertainment centers, smart refrigerators or time-saving kitchen gadgets. This can create space concerns as well as overload the wiring, so it needs to be addressed. The first concern will need to be whether the wiring is up to code and can handle the demands of a modern household. Not only will this make it easier to sell or rent the property, but it will save you legal liabilities in the future. Moving walls so there is room for a big-screen television, bigger kitchen appliances or modern washing machines can be costly, but it can pay off in the long run in terms of rent, resell and energy efficiency.
Storage Space in Smaller Buildings
Older buildings were often much smaller than those built today, and they were set up much differently. For example, you might find that your multifamily real estate investment deal does not include closets or master baths. This can be an instant “no” for many interested parties because there needs to be space for Mom to brush her teeth without kids underfoot and for Dad to store his tie collection. Expanding or adding closets and bathroom spaces is a good way to appeal to more tenants and increase resell value.
Aging Plumbing and Broken Lines
A broken sewage line is a nightmare of many homeowners and landlords because it represents a costly repair as well as expensive remediation for the home and the items in it. By overhauling the plumbing from the very start, you can get rid of lines which are not up to current codes, replace broken lines before the damage adds up and not put any of your other renovations in danger of contamination. Most of the time the damages to these lines are from aging materials, like terra cotta, or tree roots growing into the pipes.
Buying older multifamily real estate can be a good investment, but not for many reasons that most people think. You are likely getting a cheaper price because everything is out of date and needs to be refurbished. Taking on this work can increase your returns while still offering your tenants the charm and appeal of an older home.