Retailing as used in this article is defined as fixing up a property with the goal of reselling it to an owner occupant.

Figuring your expenses when planning a retail project can be difficult. The best rule of thumb for investors who are relatively new to this part of the business is to take on projects that do not require major changes to existing floor plans. Even experienced investors may find it difficult to stay within budget on rehab projects where a second floor or additional room is being added, or walls moved.

Room additions, or changes to existing floor plans will inevitably run into design problems or other delays that are difficult or impossible to predict ahead of time. These types of issues can cause you to exceed your budgeted numbers by tens of thousands of dollars. Such large-scale projects should not be attempted unless you have the experience and an adequate budget.

One of the most common problems among newer investors is starting a project with an inadequate budget, and having too little time to devote to the project. I wish I had a dollar for every rehab I have seen that was for sale by an investor who was bailing out. No more time, no more money, and most likely, no more patience. Retailing is not for everyone. The guys who are really successful at retailing know their market, understand what improvements will provide the greatest return, and don