Sweat Equity

Just got off the phone with a client who bought a house about a year ago. They bought a fixer and had grand ideas of upgrading...which is the theory behind a fixer: buy low, put in personal sacrifice of labor and time, then the value will be higher upon completion of those tasks. Add a little room for neighborhood appreciation, and you've got more value (equity) than when you bought it a year before. That's the "work" part of the equation... the Sweat comes from your investment into the project. Without improving a property, you're banking purely on the market to add value...which isn't always the wildfire Appreciation we saw in the 2000 to 2005 market, and yes, sometimes the market dips (corrects). So, the best hedge for increasing value are the Twin forces of Appeciation and Property Improvement when looking at a Fixer type property. Add a bit of Principal Mortgage Reduction (paying down the loan)...and you've got even more value in that property. Remeber my mantra for Fixers: "Worst House, Best Neighborhood." For contractors, the Uglier the better! Don't take on a project beyond your scope of ability as it will end up costing you. For more information on Fixers, Appreciation, Flipping home or getting into a new home, contact me. Pat Townsley, Realtor and Mortgage Broker. www.PTRE.net toll free at 800-646-5527. I've done it. I offer you my first-hand experience and deliver real-world results. Thanks.