When To Stop Rehabbing Your Rehab…

How much is too much when rehabbing?

How much money should you put into your rehab project? How do you know what to do and what not to do? When you are looking at your rehab project, there is always going to be something else that you could repair or another thing that you could add. Gathering some local market data and keeping your overall goal in mind can help you avoid the plague of overspending. In this article we’ll discuss how you can judge when to stop rehabbing your rehab…and keep more money in your pocket.

Gather Market Data

When deciding how big of a rehab to do on a house, first research the market.

News Flash…You probably don’t need marble countertops and travertine floors in a house that you are going to sell for $150,000…You just need to be a little better than your competition. How will you know what your competition looks like? Take a look at the recently sold properties in the area of your project and see what they look like. Do they all have granite countertops and real wood floors? If so, you might have to step it up a bit…But, if all you see is laminate countertops and carpet throughout, then there is no need to spend a bunch of money putting in marble and real hardwoods. 

If your property is in a neighborhood where all the properties are selling for between $200-250K, then no matter how nice you make your property, you are never going to sell it for $400K. People who are looking to spend $400K are looking in a different area and if you continue to over-improve your property you are going to end up with a “$400K house” that still sells for $250K.  

TIP: Watch out for big value changes within the same neighborhood. i.e., One side of the neighborhood is zoned historic and one side is not.

Take a look at all the available data and make sure that you are outperforming your competition but not outpacing your target market. This will help keep you from overspending on things that will not bring you a return on your investment.

Start With A Plan & Stick To The Plan

Do you have a detailed plan before starting your rehab project? Because if you don’t you can fall into the trap of adding one more thing over and over again and blowing past your budget. Starting with a detailed plan of what you will and will not do can help keep you on track throughout your project.

Trust me, as you go along, there will always be one more thing that you could do or it would also be nice if we added this…You have to know when to stop. Is it part of your plan? No, then is it something that you really need in this house? You made the plan for a reason and you need to try and stick to that plan.

Now, you will come across things that you did not anticipate that are safety issues and sometimes major repairs that just have to be done. We’re not talking about those, obviously, those need to be fixed. We’re talking about all those great ideas that you come up with late in the project that are in addition to your original plan. Ask yourself this: Is it going to help me sell this property for more money? Is it going to help this property sell a lot faster than it would if I left it out? If the answer is no or not really, then you need to take a hard look at whether spending the extra time and money is worth it or if it is just going to make you feel like you made a prettier house.

Rehab vs. Rental

This section is for all you rental property owners out there…there is a big difference in the level of rehab that should be going into a property that you plan to rent vs. a property that you are rehabbing to turn around and put on the market. What is this property going to be used for?

I have seen time after time where new rental property owners rehab their first rental property to look like the Taj Mahal of the neighborhood only to discover that the tenants do not care for the property like they had hoped and that their upgrades don’t affect the rent rate. Again, you need to look at the comparable properties in the neighborhood and make yours just a little better than those. This will mean that your property will rent before the competition without you overspending on your renovation.

Rental properties need reliable products and resistant finishes, not beautiful porcelain tiles and a cappuccino maker that doubles as a bread machine. Most high-end finishes are just not as durable as some of the less expensive alternatives. You can make a huge difference in your return on investment by choosing products that will last through several cycles of tenants and often the properties will bring in the same amount of rent.

TIP: Planning on owning more than one rental property? Look for paint colors and flooring that you can use throughout all your rentals. Do you really want to search for the paint colors for each house every time you have a new tenant?


Have you done your research? Do you know what your competition looks like and what you need to do to beat out the competition? Now you need to make a plan and commit to sticking to it! You are not going to live in this house, so when you think of all of the things that it would be nice to do, make sure that the extra time and money that you are going to spend will bring you an appropriate additional return. You bought this house as an investment and in order for it to be one of many, you need to know when to stop rehabbing your rehab.

Good luck and please feel free to reach out to me or leave a comment!

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