What Are Rehab Properties and Why Would You Want to Buy Them?

Trying to learn about rehab properties? Not sure why you would want to buy a rehab property?

If you’re looking for ways to get involved in real estate, you should consider buying a rehab property. Rehab properties can be a great way to invest in real estate and get started out on the right foot

In this article, we’ll tell you what rehab properties are and why you should consider buying them.

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What Are Rehab Properties?

Rehab properties are distressed properties that aren’t fully ready for a tenant or home buyer to move into. Otherwise known as “fixer-uppers”, these rehab properties tend to need some repairs and a good bit of TLC.

Many investors buy rehab properties, make some renovations, and then sell them for quite a bit of a profit. This is known as “fixing and flipping” and has remained one of the most popular and lucrative strategies for making money in real estate for a while. Investors who decide to rehabilitate these properties can get significant profits. 

Not just for experienced investors, fixing and flipping rehab properties can also be a great option for newbies to real estate as well, as long as they’re willing to learn the ropes and put their best foot forward during the renovation process. Keep in mind, however, that project times vary. Renovations could take just a few weeks or several months, depending on the extent of the damage and how much work needs to be done.

Why Would You Want to Buy a Rehab Property?

While we’ve touched on a few of the benefits of rehab properties already, below we’ll dig a little deeper into why buying these properties can be a great choice for investors.

  1. Potential Profits

As mentioned above, one of the top reasons why you may want to buy a rehab property is because of the potential profits. Rehab properties can often be bought for a pretty low price, and with a little bit of TLC, the value can be increased significantly.

Investors who are willing to perform much of the work themselves or who have great relationships with contractors can end up selling a property for a much higher price when all is said and done. While there are other ways to make money with real estate, fixing and flipping a rehab property is one of the best ways to do it.

  1. Small Initial Investments

Another benefit of buying rehab properties is that there’s very little startup capital required to do it.

Compared to buying other types of businesses where you’ll need to also invest in inventory and equipment, buying a rehab property is not too big of an initial investment. You also don’t need any special licenses or university degrees to get started with flipping properties either.

As compared to buying a turnkey property or another type of real estate, buying a rehab property can also be a good alternative that requires less capital upfront.


However, while there is often a lower initial investment with rehab properties it can still be hard to come up with the cash if you’re just getting started. In some cases, it’s a great idea to get a loan from a residential rehab hard money lender.

  1. Get Started Slowly

One of the best benefits of buying rehab homes and fixing them is that you can do it with minimal time investment as well. Before making real estate your full-time career, you’ll be able to work part-time and do a bit of work on the side when it’s convenient.

For people who currently have a full-time job, getting into real estate can be a difficult task. By focusing on rehab properties and renovating them over time, you’ll be able to get involved in real estate with minimal time commitment while starting to learn the ropes.

  1. Educate Yourself

One of the top reasons to buy rehab properties is that if you’re new to real estate, it can teach you quite a bit. Completely rehabilitating a property is a great way to learn the basics of real estate while gaining confidence in your skills.

By fixing up a property, it will be necessary to make contracts and negotiate work that needs to be done. You’ll also get an idea of what different types of materials cost.

By successfully rehabbing a property, a newcomer to real estate will learn things that will help them prepare for further involvement in real estate as time goes on.

  1. Feel a Sense of Satisfaction

Another reason to rehab homes is that it is rewarding. Rehabbing homes can help you use the creative muscles you have to give a home a makeover. You’ll be learning to take a home that was past its prime, and in bad shape, become a great place to live again.

When you sell the home and hand over the keys to a new owner, you’ll get a sense of satisfaction that is hard to beat. Creating a beautiful space to live in from a home that was previously unlivable can be a great feeling. 

  1. Strengthen Your Community

Another great thing about fixing and flipping a rehab property is that it can help improve your local community as well.

By flipping houses, you’ll be doing your part for your city or town, and your work can help to raise property values and improve neighborhoods. On top of that, you’ll also be putting plenty of people to work as you hire contractors and buy materials for your rehab property.

Making the Choice to Invest in Rehab Properties

If you want to make money in real estate, it’s a great idea to get started with rehab properties. By learning how to successfully fix and flip a property, you’ll be able to start your real estate career out on a great foot.

Need more tips and ideas for getting involved with real estate? Take a closer look at our blog now to find more articles and guides that can help.