Buying a fixer-upper offers you an amazing investment opportunity and provides an endless assortment of projects for those who like to work with their hands.
No matter if you plan to flip the property quickly or live there for some time, you shouldn't cross a fixer-upper off your list when buying a house. Still, we all know that buying a house can be a complex challenge and fixer-uppers add a bit more for you to think about.
So... What do you really need to know when buying a fixer-upper?
Get off to a running start with these five tips:
Buying a house can be the greatest step you ever take for your peace of mind, financial security, and yes — your enjoyment. The choice to make that house a fixer-upper can be considered a bold one. Still, for some people, there's simply nothing better.
Use our tips, and you'll find it's easier than you ever imagined to make the right decisions for buying a house. In just a matter of months, your very own fixer-upper could become the home of your dreams. If you go in with a clear view and realistic expectations, you can't lose!
Got a fixer-upper in your sights? Good for you. Whether this old house is going to be your dream home or you're angling for a rental income, it's best to know what you're getting into before you lay your money down. Don't be beguiled by the dream: make a cool-headed assessment from the top of the roof to the foundation and, if it's got one, the basement.
Finding a Fixer-Upper
The local clerk of court's website is a good place to find deals, including foreclosures and short sales. Also, find foreclosure listings on Homes.com. Shop through auctions and estate sales. (Caution: Do your due diligence and research thoroughly; avoid careless bids.) Your real estate professional may also be able to help you with finding the right fixer-upper.
Once you find a home you want to acquire, hire a home inspector. You might even enlist a couple of home inspectors. Or, ir you're competent to judge how well a house is holding up, you'll need to look at the following:
Pay particular attention to foundation and wall cracks, as well as water damage.
Flooring is likely one of the major renovations you will make. If you have hardwood, it may be worth refinishing. If it needs to be replaced, you might consider laminate, which looks good, is easily maintained, costs less than hardwood, and is very durable. You might go for carpet, especially if you're in a colder climate, while tile might be the best choice for the kitchen and bathroom.
Hiring a Contractor
Once you've got an idea of the scope of your renovation, interview some contractors — at least three. You'll want to hire someone who has the ability to create a prospectus for the work so that you can refer to it and be assured the contractor is on track with the timeline and knows what you want. By interviewing more than one contractor, you could have a backup if one starts giving you the run-around.
Planning Your Project
The kind of fix-up you will do should depend on whether you intend to stay in this home for the rest of your life, or if you want to fix it up for a shorter-term goal: to sell it or to use it as a rental property. For instance, if you intend to stay in the home you may want to spend more for better, long-lasting materials, personalized colors, and in general, unique touches that will appeal more to you and your family rather than to a potential buyer. If the home is to be a rental property, you will want to use durable materials.
Fees and Permits
Chances are you'll need to pay fees and purchase permits to do some of the work on your fixer-upper. A reputable contractor may do this for you, but do follow up and ask questions about what kind of permits have been obtained. Check with your local authorities so you will know what is required.
Will You Stay or Go?
Staying in your home during renovations may work out if you're doing the work yourself — or not. It could be easier to remove yourself and the family to a motel until the work is done.
Fixing a fixer-upper can be an exciting and rewarding adventure. Above all, remember that good planning and organization can get you through the rough spots and will see you to the satisfactory completion of your project.
Buying a fixer-upper home can be a great way to acquire a home in a neighborhood you might not otherwise be able to afford. Maybe you've picked out a charming older home you think just needs some tender loving care to bring out its best. That may be true, but beware of romancing yourself into a costly renovation nightmare, where you can't recover your investment once the house goes on the market.
That doesn't mean you should avoid fixer-uppers altogether. But do be aware of the possible pitfalls. Once you've weighed the pros and cons, you can make a more informed decision about investing in that sweet little mid-century modern you've had your eye on.
Consider these points before buying a fixer-upper.
DIY Skills Can Make a Fixer Upper More Affordable
So you've fallen for a fixer-upper, and you're weighing the possibilities. One of the first things to consider is how much of the work you're able to do yourself. If you love to work on old houses, you're a step ahead. But those with no DIY skills may be locked into overseeing contractors for every renovation. That can cause some headaches and will certainly cost more than if you can do the work yourself.
Renovations: Cosmetic or Structural?
Once you make an offer for a home and it's accepted, you'll need a home inspection. An inspection can help assure your fixer-upper is a good investment, or it may provide a warning that you should take a pass.
Be mindful that major repairs — foundation fixes, roof and wall renovations, plumbing, and electrical system redos — may not raise the house's value sufficiently to offset the renovation cost. Ideally, a fixer-upper should require mainly cosmetic repairs. These repairs don't cost a lot, and they raise the value of the home. They might include painting touch-ups, fixing doors, installing new light fixtures, drywall repairs, refinishing floors, and updating bathrooms and kitchens.
Also, be aware that if your fixer-upper has some differences that set it off from other homes in the neighborhood — for example, two bedrooms instead of three, or one bathroom instead of two — these may impede selling it.
Further, you will want to avoid renovations that promise to take an extraordinarily long time. By the time you finish, you may find that the home's market value has gone down.
Can You Afford It?
Add up the cost of materials and labor — that is, your labor and that of any contractors. Then, subtract that figure from the estimated market value of the home post-renovation. Compare your fixer-upper with other homes in the neighborhood to determine estimated market value. Deduct another 5 to 10 percent for extras, possible problems you may encounter, and inflation. The figure you arrive at should be your offer.
You've got several options when it comes to financing your renovation. Putting the bills on a credit card is easy, but you'll be paying high interest rates. A renovation loan lets you finance a house and improvements together. The interest rate is lower than many other financing types, and you can take longer to pay off the loan. Some types of renovation loans include:
Is a fixer-upper worth it? The answer, as with any investment, is: "It depends." For many homeowners, a fixer-upper will be the right choice. Just be sure the renovation is not more work and more expensive than you're anticipating. A good real estate agent will also help you make a more informed decision.
Buying a house that needs renovations can be a great way to find a deal, but the choice between a move-in ready home and a fixer-upper is about more than just the purchase price. The cost of renovations, the time you have available to tackle DIY tasks, your timeline for moving in, and your risk tolerance all play an essential part in making the right choice. If you have what it takes to tackle a fixer-upper, you may be able to customize your home and save some money on the purchase price.
While there are risks involved, buying a house that needs work can allow you to maximize your budget and customize your new home to your preferences. The key is to be honest with yourself about whether a fixer-upper fits your needs, and set clear goals when buying a house.
A new roof is one of the most expensive home improvement projects owners may have to tackle. If you've been thinking about replacing your roof, you may be surprised by the number of important decisions you'll have to make. This includes figuring out your financing, choosing a great roofer, and deciding on the best roofing materials for your home.
When it comes time to choose your roofing materials, you may be surprised by the number of options available. Each option brings varying costs, quality, and aesthetics. Not sure which to choose? Start by reviewing the pros and cons of the following five popular roofing options.
Before making your final decision, you'll need to consider a wide variety of factors including your budget, the environmental conditions where you live, and the overall look you want to achieve.
Since replacing your roof is definitely your run-of-the-mill DIY home improvement project, you might also consider asking your roofing company to help you determine which material is the most appropriate for your home and the goals you're trying to achieve.
While renting a home is a rite of passage for most people, there comes a time when most of us get tired of stroking a check to the landlord every month. If you've started thinking about joining the 65 percent of Americans who own their own homes, you'll be glad to know that now is a great time to do it!
Not sure if you're ready to take the leap into homeownership? Check out these five huge advantages of buying a house over renting.
When you're buying a house there are lots of decisions to be made. One of those decisions is whether or not you're willing to purchase a fixer-upper. You're sure to find plenty of examples glamorizing the fixer-upper experience, and it can be tempting to want in on the action. You've likely heard tons of stories about incredible deals people got because their home needed a little work. Not to mention all those TV shows where houses no one could even lives in gets turned into something worthy of a magazine spread and sold for top dollar. Fixer-uppers can definitely be an amazing find, but before you dive in head first, weigh the pros and cons to make the right decision for you.
When you're buying a house, you need to look at the pros and cons to make an informed decision. And that strategy is even more important if you're planning on purchasing a fixer-upper. But doing your homework, getting estimates and budgeting appropriately may make that decision the right one for you.
A swimming pool can be a major perk when you're shopping for a new home, allowing you to maximize the use of outdoor space and providing plenty of warm-weather family fun just outside your door. Whether you're shopping for a new home or adding a pool to your current home, it's important to consider your options. Both in-ground and above-ground pools come with their own unique advantages and drawbacks. Choosing the right option depends on your budget, space, future plans, how you will use the pool, and a variety of other factors. Consider the most important factors to find the right fit:
In the end, the right option for you depends upon personal factors. An in-ground pool is more expensive to maintain, but also longer lasting. An above-ground pool may be more affordable to operate but doesn't always offer the same longevity or variety. Fortunately, both options offer plenty of potential for outdoor fun.
If you're thinking about selling your home, now is the time to start making any necessary renovations and updates. While you might think you know exactly what needs to be done, it's smart to talk to a real estate agent before you get started. He or she will be able to tell you exactly which features are most popular with homebuyers so you can focus your time and money on the projects most likely to improve your bottom line.
While buyers often have varying priorities when it comes to a home's interior, most may want the same features on the outside. Investing in the following five projects will help increase the chances of selling your home for top dollar.
Buying a home is a worthy objective for a single woman. It is also a significant accomplishment that involves planning, saving, and achieving a good credit score. It takes a bit more effort when you are the only source of income, so here are seven tips for the single woman interested in buying her first home.
Whether you're a first-time buyer or experienced homeowner at some point you'll need to make home repairs. And those repairs will cost money. It's something first-time buyers often don't think about ahead of time and experienced owners may have learned the hard way. So budgeting at least some money in advance for these expenses is a must. Here's how to figure it all out.
The first step is deciding how much to save for home repairs. Here are a few different ways you can approach budgeting.
Once you have a starting point you'll need to adjust your budget to account for the specifics of your home.
Add 10 percent of your basic budget per year for each factor that increases the likelihood of repairs. For example, a basic budget of $2,000 per year for an older home in an area where bad weather is common, would increase that budget to $2,400 per year.
While no one can guess exactly what your home repair costs will be, being prepared and budgeting in advance will save you lots of headaches later and allow you to enjoy the benefits of homeownership for years to come.
Whether you are in the middle of a home improvement project or just working in the garage, having access to the right tools for the job can make the entire process much easier. Of course, having access to the right tools is especially important for someone new in the DIY world, and here are the top ten tools that everyone needs for a wide range of projects.
Of course, there are plenty more tools available, but these tools are a great starting point for anyone beginning a new home improvement project. Whether you are a beginner or have many years of experience, you can save the added expenses of using a contractor and start your DIY project today!
A fixer-upper can be one of the best deals in any housing market--if you're prepared.
Many people especially first-time home buyers start their search at the top of the budget range they can afford or get financed. However, the decision to take on a fixer-upper can not only save lots of money but give you a special sense of pride as you put your mark on your future dream home.
The choice to consider a fixer-upper will open a whole new segment of the market to you.
But: It's important to take some extra precautions with this kind of "home improvement."The process of finding the right fixer-upper comes down to three big steps:
Many buyers--from first-time homeowners to "fix and flip" investors--seek out fixer-uppers all the time. Fixer-uppers are not only uniquely satisfying, they present other opportunities as well. For example, a low-priced fixer-upper might make it easier for you to obtain financing.
Whatever the case, finding the right real estate agent for you is essential. Personalized advice from an expert you can trust will make the process easier and help you avoid oversights.