Becoming a full time property rehabber is actually a very easy process. So why do so many investors get it wrong, or even worse, do nothing?
Simple: NO BUSINESS PLAN!
Make no mistake about it: This is a business!.
If you invest time and capital with the aim of making a profit, then you are in business, regardless of wether you purchase one or fifty homes. Before you commit a single dollar or a minute of your time, you should step back and have a good think about what it is that you want to achieve. When developing your business plan, you may wish to consider the following questions: – How many renovations do you wish to complete in one year? – Do you have sufficient capital/finance to achieve this target? – Will you sell for profit or hold? – Do you wish to create an additional income stream? Do you wish to do it as a full time job? Why you need to write a business plan? To plot the course – To create the “big picture” – to recognise long term direction and think about staying in business and not just starting a business To create a feasibility study – Test the viability of your goals – Is it going to be profitable – What kind of financing will you need – Recognise the barriers to your success Become a better decision maker – Anticipate problems – The process of gathering information ahead of time will allow you to make more informed decisions – Your plan will provide you with an organised way to face issues For a reality check – The plan will challenge some of your pre-conceived assumptions – Your plan will raise questions that will inspire solutions before you need to face those problems – It allows you to recognise what will be required of you – Identifies your strengths and weaknesses and highlights needed areas of assistance Guide and measurement tool The business plan will act as a guide throughout your development and allow you to measure your progress against planned expectations. You can make adjustments accordingly.
Your business plan should contain the following elements:
- Executive Summary: Include general information about your business; your objectives; and your Start-Up details.
- Market Analysis Summary: Give a brief description of the market that you intend to work in, and your acquisition strategy.
- Implementation Plan: Outlines your renovation strategy and process.
- Sales Strategy.
- Sales Projection
- Projected Profits and/or Losses
- Financial Plan.
- Management Summary.
- Important Assumptions.
- Feel free to reprint this article in its entirety in your ezine or on your site so long as you leave all links in place, do not modify the content and include our resource box as listed above.
If you do use the material please send us a note so we can take a look. Thanks. Feel free to substitute your affiliate link in place of our link in the resource box. About the author: Sal Vannutini is a successful real estate investor and author of the best selling “Fixer-Upper Fortunes”. Free e-book and 6 Part mini-course reveals how to make a fortune in real estate.