torstai 27. syyskuuta 2018

Easy money, easy fix or just a tale?

Many seem to be talking about how they are making huge deals by buying low or horrible condition apartments. Investors tend to make "six figures" (or perhaps not that much, but still) by just buying and renovating and selling apartments. Yeah yeah it is called flipping but I hate the word, especially because it is a very "modern word" used in Finland. Flipping is a thing in Finland right now and so is the whole real estate investing. It seems to be for everybody and everyone seems to think that it is easy money or even risk free.

Yes, I have done fixer upper cases myself too. I have merely bought them because I have thought that it has been a good deal, renovated them and then rented them out. It has been quite easy and I have learnt a lot. And the renting part is way easier when the apartment is in top condition. But it does need some effort or if you don't want to do it yourself then you need to invest even more money. One can save money by DIY, but one can quite often save more time by outsourcing.

So I would say that there is no easy money or nowadays I would even say that there are no easy renovations. One can calculate everything and still miss the budget and timeline by miles. One needs to take into consideration the rules and regulations, outsourcing and the end user. There are many factors that can go wrong or sideways.

So, one can add up value by renovating an apartment which is in horrible condition and by doing it right. It can be done by good planning, choosing the right colors, right contractors and by really adding value to the end user (it can be a tenant or a buyer). Bright pink wall or orange kitchen cabinets might not be the right ways to go. Gray, black and white sounds really dull but they are also very safe. More color and imagination can be added with furniture and interior design.

Is real estate investing effortless? No I would not say so... It really depends... If it is a hobby does it count? How do you calculate the time you spend on for example blogs and news about real estate? It really is very hard to say. It is easy to calculate how much time it took to find a new tenant or to finish renovations, but the small things are easy to forget and I would say that on a yearly basis the small things can pile up significantly. My biggest effort is doing the taxes and it takes from 1-2 days of work every year. I do admit that the little things, reading blogs, educating and improving myself and my methods, take way more time and effort.

Do I love what I do? I doubt it, but I like it. I love my family and my friends that is for sure. It is not always how much money you invest and make but how much time you invest and what you earn from it.

Vuokranantaja has left the building...

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