Pick the right neighborhood
When it comes to fixer-uppers, where you renovate plays a key role in what you'll recoup on resale.
"Quite simply, you don't want to have the most expensive house in the neighborhood," says Kelly. "If you're buying a fixer-upper, you want one that is going to be the least-expensive house and then build toward the mid-price point. If you're looking to buy, fix it up and have it be the most expensive house in the neighborhood, watch out!"
Want to pay for home improvements with a home equity loan or line of credit? Check out the rates at Bankrate.com.