Buy Improve Sell for Maximum Return

17 Maximum Return is used by permission of HomeFixers. Thanks, Rick!

where the costs of improvement have chewed away your margin. Selling before this point (while the property is under-improved and not yet ready for resale) will lower your profit margin or even cost you money. At a certain point, you realize that your improvements reach critical mass—the point of your minimum return (or maximum loss)—and subsequent improvements will earn you more than they cost.

From this point on, as you make additional improvements (if they are the right improvements), you will increase the market value of the property. You are in the prime improvement zone. However, be aware that this increase in value has a practical limit: what the market will bear. From here on any additional investment in improvements will not add much, if any, market value to the property. You have reached the point of Maximum Return on Investment. It is now time to avoid over-improving the property and put it on the resale market fast, cash in on your profit margin, and move on to the

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