Whether you’re the owner or the listing agent, rehabbing and managing aged property can be a hassle. While older homes can make great rental properties, they also tend to have more problems, and be more difficult and costly to repair.

The most important thing to remember is that rehabilitating a property begins before it’s even purchased, and continues for the life of the home. Aged properties aren’t for the faint of heart, but when done correctly, can turn a great profit.

Before the Sale

The first step to rehabbing a property is to get it thoroughly inspected before purchase. is will tell you with no doubt what exactly is wrong with the home, and give a starting point for repair time and cost. There are other important facts that getting the property inspected and researched can help with, also. “Aged properties may have been rezoned or may be eligible for re- purposing the existing use (Single Family Residence to Multi-Family Residence). If the home is simply being rehabbed, step back and ask yourself what incremental costs will yield the greatest return on investment,” advises Doug Roberts, Owner, Doug Roberts Real Estate.

Once inspection has been completed, weigh the projected repair cost with your expected return value. “Aged properties can often be money pits! Make sure you have an expert team (contractors, etc.) to help guide you on your decisions,” says Roberts. is will help you get a realistic idea of what o er you should make.

Consider the demographics of the area, and con rm that your plans for the home match the local market. You do not want to sell a home when the local market consists mainly of renters, and you may have problems keeping a rental occupied if the area is compiled of mainly homeowners.

You’re a Homeowner!

Once the sale is finalized, you will need to take inventory, and make a list of all repairs that are needed. It is a good idea to begin with the largest, more time consuming repairs. This will allow smaller repairs intermittently, and not leave you scrambling at the end of the process. Remember to complete all repairs before inviting tenants into the home. It is much more difficult to make repairs around people than when the home is vacant.

Let’s Fix This

There are certain problems to watch for when purchasing an older home. These damages can be extensive, and more costly than first expected.

  • Slanting Floors: When the floors in the home slant, it could be a sign of foundation damage, which can become very costly, very quickly.
  • Plaster instead of drywall: Since plaster has generally been replaced by drywall, it can be extremely difficult to find a qualified repairman.
  • Lead and Asbestos: Though these materials have for the most part been removed from homes, there are still an occasional few that contain flooring with asbestos and lead paint on the walls or lead pipes in the plumbing. If you find your prospective home contains either of these, reconsider the purchase. Excavation for these two problems can cost upwards of $200-$400/hour.
  • Mold and Mildew: These two problems can usually be taken care of with bleach water and a hefty sponge. However, an abundance of either of these can lead to excavation crews that can cost anywhere from $500 to $5000 for removal.
  • Radon Gas: Ideally your home should have below 2 pCi/L, but anywhere below 4 pCi/L is deemed livable. Any measurement over this can be extremely dangerous to your tenants, as Radon Gas has been deemed the second leading cause of lung cancer. The removal process for this issue can set you back an average of $1,200.
  • Outdated Appliances: While this may not seem like a huge issue, multiple appliances breaking at once, or trying to repair or replace them with occupants can be a difficult process.
  • Electrical Systems: The problem occurs when the home has fuses instead of breakers, which can cause both repair and code issues. is can be a costly problem to fix, but will definitely be more costly if put off.

    Remembering the Good Times

    Aged properties have their good points, too. There are many qualities you can find in an older home that just can’t be found anywhere else. Most aged properties are very centrally located, which is usually a good quality in a rental home. The craftsmanship in the flooring and cabinetry is also not found in today’s homes.

    Get Out There

    One idea that many don’t consider until the final days of the rehabbing process is marketability. “Driving demand will ensure that holding costs are kept at a minimum once work is completed,” explains Roberts. Marketing a property in a timely manner can not only save you money from non-occupancy, but can also save valuable time and energy from upkeep and maintenance.

    ere are many bene ts to bal- ance out the hardships of rehabbing or managing aged inventory, but the key is to weigh the cost against the return. Careful planning and timely execution can mean the di erence between a dream home and a night- mare situation.