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Originally Posted by SleazyDream
I got to thinking a while ago when someone told me about a $10,000 mortage they have - it shocked me cause mine's only about $1000 - but then i stopped and realized i spend usually over $10,000 a month in reno in the last few houses I've bought..
which is the better route? not going to make much when i sell them but i'll get my money back and then some - but no different then if i bought a finished product..
thoughts?
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If your dropping 1k on a mortgage payment while someone else is spending 10k. Even if you are spending 10k a month on renovations you are the generally the better off party. Assuming the renovations are of the proper type in a house that actually adds a good return in value, or at very least the lack of them being done had kept the houses value down around 40-50 cents on the dollar in renovation costs for that project. Area's like curb appeal, kitchens, bathrooms and so on. Where you always see a very good return of costs.
My thoughts would be that the 10k a month person is having a large chunk of that 10k just go to interest on the mortgage while the extra 10k your spending is going to increasing the value of the property above and beyond the normal appreciation rate.