Avoid Home Remodeling and Renovating Mistakes

With the housing market always fluctuating, sometimes it is just easier and cheaper to renovate and remodel your home. Perhaps the most important and most difficult part of remodeling your home is setting a reasonable budget. Once that task is taken care of, the work begins, and in the case of home remodeling, the work is the fun part! Coming up with new and creative ways to make your home your own is always exhilarating, especially because there are so many different styles out there today. There are a few things home remodelers should keep in mind before they begin their project, though.

Things To Consider Before Remodeling

There are several mistakes that many people make when remodeling their homes. In an attempt to be as frugal as possible (because let’s face it, we all want the best deals), many people buy the cheapest materials thinking they are getting a good deal, but in most cases those materials have to be replaced in a short period of time ultimately costing more money rather than saving any. HGTV reminds home remodelers that you get what you pay for, so in the case of home remodeling don’t be afraid to budget a little more for higher quality materials. Another common mistake home remodelers run into is inaccurate measurements. It never hurts to double, triple, quadruple check measurements to avoid having to start over, and spend more money to fix the mistake. Never skip the prep work such as measuring, taping, and other tedious techniques. While they can be annoying and we all tend to be confident enough that we don’t need to waste time doing the prep work, more often than not projects do not go as planned and cost a lot more because the prep work was avoided. One of the most common mistakes home remodelers make is going too trendy with their renovations.

While it is fun to have the most in style décor, it is important to remember that styles fade and home remodeling is expensive, so in order to avoid facing multiple remodels, it is always best to stick with classic styles that are long term rather than short-term trends. Most importantly, home remodelers should remember to have patience. Home remodeling is a long process depending on the project. Not only is it a lot of work, it can be bring a lot of chaos depending on the size of the project. Maintaining patience throughout the project is vital for a remodeler’s sanity. Many people often give up halfway through projects because it becomes too much to handle and the anticipation of it being completed takes over. No matter the size of the home, remodeling is always a big project and it is important that remodelers focus on the little details and give themselves plenty of time to complete it. If these tips are followed, the long hours will be well worth it!

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Source: hgtv.com/homekeeping/top-25-biggest-renovating-mistakes/pictures/index.html


Becoming An Income Property Owner

Do-it-yourself home renovators are often also property investors. My own parents-in-law do this. They buy foreclosed properties at auction or through negotiation with the bank, assess what kinds of improvements could best raise the home’s quality and value, and then do the work themselves so they’re just spending money on materials and not on contractors’ fees or labor. Once the house is move-in ready, they either lease it and retain the home as a rental property, or the put it back up on the market for a higher price than they purchased it for.

What It Takes To Be Successful
Sound easy? It’s not. Property investment takes a well-trained eye to spot possible catastrophic problems in a home, good negotiation skills, knowledge of how much homes in the area are worth, knowledge of how much value various renovations can add to a home, the ability to create and stick to a reno budget, and dedication to see a project through. Knowing something about marketing and the real estate market doesn’t hurt either.

Deducting Depreciation On Rental Properties
Here’s something an income property owner should understand: Did you know that you can deduct depreciation on rental properties? According to the IRS website, this means, “You can recover the cost of income-producing property through yearly tax deductions.” In order to do this, “Your property must have a determinable useful life. This means that it must be something that wears out, decays, gets used up, becomes obsolete, or loses its value from natural causes.”
To decide whether your property qualifies for depreciation tax deductions, you should answer yes to the following questions:

Do You Own The Property?
Do you use the property in your business or income-producing activity (such as a rental property)?
Does the property have a determinable useful life?
Is the property expected to last more than one year?

However, the IRS says you cannot depreciate property you bought or sold (or took out of business) in the same year, nor can you depreciate “equipment used to build capital improvements.” Once you have recovered the cost of your rental property you will no longer depreciate it.

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Source: irs.gov/publications/p527/ch02.htm