Thinking about buying a fixer upper?

Have you ever thought about buying home that needs a bit of love and fixing it up? You’ve probably wondered who actually makes money rehabbing real estate. Before you dive in, it’s important to know the basics of successfully buying, fixing up and selling or renting an investment property. Here are three key pieces of advice:

Evaluate your skills. Anything you can do yourself will save you money. But know your limitations. You may be much better off hiring someone qualified to do the work for you.

Find the right investment. A realtor can be an invaluable partner in an investment property purchase, helping you locate good investments that are close to you. Look for neighborhoods where the number of jobs and residents is growing. Your realtor can help you figure out whether the home is a good purchase based on its cost and the amount of rent you can expect to receive.

Don’t skimp on insurance or financial help. If you’ll be renting out the house, get both dwelling and liability insurance policies. Additionally, hire a tax professional to ensure proper reporting on your personal return. A financial adviser also can help you decide whether you should create a separate entity to purchase your investment property or to own it in your own name.