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Renovation Using Wholesale Materials
Contributed by Admin on July 23, 2011

The key to purchasing, renovating, and the flipping real estate is ensuring that the money you invest upgrading the home is more than paid back in the final purchase price. Things like blinds, hardwood floors, granite counters, marble bath tubs, patios, new appliances, and pools can all drastically increase the selling price of a home, but that doesn’t necessarily mean you will turn a profit. Renovations need to be weighed heavily and done for the lowest possible price. And the best way to do that is to cut out all the various middle men and use Wholesale materials.

One great way to think through whether a home renovation has a return on investment is to use a renovation calculator like the one developed by CNN Money available here. It details 25 different common renovation projects – everything from replacing a roof to upgrading the bathroom, and calculates the cost and increase in selling price for the home. For example, according to the tool adding a sunroom will cost approximately $50,000 and increase the selling price of the home by $32,000. This means that only 60% of the cost will be recovered. If you are planning to live in the home a long time and want to enjoy a new sunroom that’s great, but if you are looking to sell for a profit in the near-term this isn’t an investment that makes financial sense.

So, that begs the question “how can I renovate my home and then it for a profit”. The answer is simple – cut out the middleman (or middlemen) and buy direct. You can save lots of money by looking for wholesale hardwood flooring or other materials at a fraction of the cost big retailers charge. Like with any other business buying wholesale means better prices, and for real estate it can mean the difference between taking a loss on a renovation and turning a profit. In the sunroom example, if you were able to cut the costs by 50% through purchasing the flooring, windows, and other materials wholesale it would take the project from a 60% payback to 128% payback. You can imagine the profits you could turn doing numerous upgrades like this on countless houses at the same time.

Home renovations must be weighed carefully to ensure there is a return on investment, and the best way to do that is using wholesale materials.

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