If you’re a San Antonio investment property buyer, you know prices are falling in 2025. This is a fine time to pick up your next San Antonio fixer upper. Many San Antonio distressed property investors have been out of the market in recent times because of higher prices.
If you are getting back into the market and want to buy your next San Antonio fixer upper, we want to give you a refresher. You should keep several points in mind when you buy a San Antonio fixer upper and get ready to renovate it:
Keep The End Game Top of Mind!
A common issue I have seen with investors who have been out of the fixer-upper market for a few years is scope creep. Scope creep occurs when your investment property goals expand, resulting in a cost that is significantly more than you initially planned.
Experienced investors know that scope creep can be deadly to your profits and cash flow. What could have begun as a ‘simple’ sheetrock and paint job on that 2 BR/1 bath in 78228 could turn into a massive renovation, including fixing things that don’t need to be to rent it. If you fall victim to scope creep, you could exceed your repair budget by several thousand dollars.
If you want to flip that San Antonio investment property, overspending $20,000 on the rehab could torpedo your profits. Alternatively, if you want to buy and hold in San Antonio, you may be forced to raise the rent, which could result in the property sitting vacant for months.
Never Overpay
I remember the first investment properties I bought in Virginia. Three-bedroom, two-bath houses. I was young, inexperienced, and head strong. I overpaid for my houses, and this mistake made it challenging to make them positive cash flow deals.
It is common to become too excited about a certain fixer upper. You might manipulate the numbers to convince yourself that they work when they don’t. Overpaying for a distressed property is the #1 reason people suffer losses in real estate investing.
So, always approach property comps like a boring, crusty accountant (or the stereotype of one!). Only look at the numbers on paper or the screen. Keep emotion out of it. There’s nothing wrong with passing on a San Antonio fixer upper and waiting for a better deal. Better to wait than pay to much and suffer losses each month!
Pay Plenty For Inspections
Discovering that the ‘perfect’ property you bought has a profit-killing flaw doesn’t feel great. I’ve seen many local investors discover a problem with a property’s pier and beam foundation a day after they bought the home. That problem can increase your repair costs by 100% or more.
Always tour any property you want to buy, and it’s best to invest in a professional inspection. Inspect the foundation, look for signs of water damage, cracks in the walls, roof damage, discolored ceiling tiles from leaks, and issues with plumbing, electricity, etc. Always listen to the inspector’s report and advice. Take their experience and findings seriously. They could save you from buying a money pit.
Don’t Be Cheap On Repairs
Take all repairs seriously. If you go cheap, the price of the home will be lower, and the inspector will notice that you have done minimal, inexpensive maintenance. If you want to rent the house, going cheap on repairs always comes back to haunt you in the long term. Poor-quality repairs always lower the tenant’s quality of life, which usually leads to more vacancies as well.
Don’t Overrepair the Fixer Upper
It’s essential to prioritize the necessary repairs to maximize the ARV or monthly rent. Don’t do more than that. Overspending will cost you on your flip, or make you demand above-market rent. Also, overimproving the home may make it a bad fit for your neighborhood. You may end up with a house that costs too much for the people in that neighborhood, and the home is also not desirable to people who can afford it because of the neighborhood.
We will have another San Antonio investment property coming this month, so stay tuned!