What is the logic behind raising a property's value?

What is the logic behind raising a property's value?

What is the logic behind raising a property's value?

Because I don't understand how can someone put for EX.

$500 in rehab

and then the value goes up $10000 more?

Can Anybody Help me to understand the logic behind this theory?

Thank you and
God Bless



I believe most people may make improvements to raise the value of a property. The key is to not over improve so you do not get your money back out when you rent it or sell it. A rule of thumb that some investors use is to put $1 into a proeprty and hope to get out $2 to $3. We can look at an example. If I put new carpet into a rental unit and it costs me $1,000 for the carpet. Maybe I can then get an extra $50 per month in rent. Thus the carpet pays for itself in less than 2 years.

In regards to selling a home. An investor may have a home they purchased for $50,000 and believe they could sell it as is for $60,000. If they do carpet, paint, other various other cosmetice improvements say for $5,000 and the improvements make the home look a lot better they may list and sell the home for even more. Say they then list and sell the home for $75,000. Those improvements helped them get more money when they sold the home. I hope this helps. Believe and Achieve! Smiling - Joe


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Joe Thank you so much

Joe You are the best...

Thank you so much for helping me out

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