Happy Fall (or Autumn) folks! I have been talking to alot of new investors over the last few weeks. All of them are wondering if November is a good time for a rehab. We are moving into the winter months and in New England that can equal harsh weather. We already saw crazy wind storms last week. I had 2 gazebos set up in my yard. The operative word is had. They are no longer standing. And, I saw weather reports that it was snowing up north in the White Mountains today. So, I completely understand the question and the concern.
I would say that every time of the year is a good time for a rehab. But, November in particular is a great time for a rehab. Think about it, your average rehab is 8 to 12 weeks to complete. In the winter, depending on the weather, it could take a little longer. It’s November 8th, you put the property under contract and close by the end of the month. You start the rehab in December and you put the property on the market sometime in March. That’s perfect for the spring retail sale cycle and perfect for the seller’s market we have been in. The demand for rehabbed and new housing has increased while the available inventory has decreased. In some cases, I’ve seen rehabbers sell the house before the rehab is completed. This can get a little trying because your buyers will want to choose finishes and coordinating everyone to make choices can be difficult. But, chances are, the time on market is going to be low because demand is currently high. So, now is a perfect time for a rehab!
When you are running your numbers, make sure to add extended holding costs in the event weather causes the rehab to go longer than the projected scope of work dictates. Remember to account for possible snow removal and heating the property (you don’t want any frozen pipes). It is always about the numbers.
But, if you are nervous about going into the winter doing a rehab, you can always wholesale! Not sure how to wholesale and want to learn? Check into this wholesaling for quick cash course with Brownstone RG.
I look forward to seeing everyone on Thur, 11/16/2017 for our upcoming meeting at BR Stone in Woburn. Happy investing everyone!
Boston AREIA Chief Connector