Fixer-uppers are notoriously risky investments, but for those that know what they’re doing they can actually turn a profit. That’s why a number of folks, especially in the Bay Area where real estate is some of the most valuable in the country, end up buying up dilapidated properties, putting in the necessary renovations, and then flipping them. It helps when you can do a lot of the work yourself, but if it isn’t a full time job, and you have to pay out of pocket for all the repairs, that’s when it becomes an issue. It’s also a reason you won’t find a lot of families willing to invest in properties that have a number of serious issues. There’s a point at which is costs more to pay for all the renovations than it would to simply find a move-in ready house listed on the market. How are folks making money on fixer uppers?
How Consignment Renovation Services Work
If you’ve inherited a house from a deceased relative, or if you’re older and you’re looking to unload a property you no longer want, but the property itself is in bad shape, it may take awhile to find a buyer that’s willing to invest in a fixer-upper. For years, you only had two options at your disposal. The first would be to leave it on the market until someone came along and was willing to buy it. The second was to sell it off as quickly and cheaply as possible to someone who would put the money into the house and then flip it for the fair market value.
Nowadays you have a third option. In the Bay Area and San Diego, there are companies that are willing to do the necessary renovations on consignment for a percentage of the final sale price of the home. This works particularly well in areas like San Francisco and San Diego because the property values are incredibly high. It means that neither the home seller, nor the homebuyer will be responsible for the repairs necessary to make the property safely liveable, and the the home seller will be able to sell the home at what is generally more than they would get from a company that buys up property, fixes it up, and then flips it fair market value.
Consignment Renovation is an Excellent Option for Seniors
This works especially well for seniors and for those that have inherited houses that they’re not sure what to do with. In both cases, renovations are performed with a consignment company’s own capital and labor investment. The homeowner would not be responsible for putting a dime of their own money into repairs, and the consignment company is paid from the sale of the home, meaning it’s a win for everyone.