Finding an appropriate house that fits your needs and budget can take a lot of time and effort. You will also need to stay incredibly patient and focused on your goal. But what if, instead of buying a fairly new house which, in today’s competitive market, might be pretty hard to get before someone else snatches it, you decided to buy a fixer-upper?
By definition, a fixer-upper house is a property that requires some renovations, whether that be something cosmetic or structural. Even if you are a complete rookie and regularly Google questions such as “how does real estate wholesaling work” or do not understand most of the professional terms related to the real estate industry, you can still consider purchasing one, as they present an excellent opportunity to buy below market value.
Thus, if you want to learn more about the things you should know before buying a fixer-upper, read on! Here, you will find a list of such things and a bunch of useful tips that will make you much more knowledgeable when it comes to the subject of buying fixer-upper houses. Check it out!
If there is one thing that can be said about the vast majority, if not pretty much all of the fixer-uppers, it is that they are famous for their ability to surprise the buyers with expensive repair needs. For instance, you may decide to rip up a suspicious-looking floorboard just to find that all the wood underneath is rotten to the point where it is unsalvageable and needs to be replaced. You may also find woodworms in the walls, discover some cockroaches crawling around the kitchen at night, or find cracks in the foundation of the house.
Of course, this does not mean that you absolutely cannot buy a fixer-upper even if you are on quite a tight budget, but your finances need to be flexible enough to accommodate the unexpected costs. If you have some experience with renovating houses, you can save money in certain areas of the house by DYIng things. Still, without a construction background, you will need professionals to help you with major renovations.
If you plan to live in your fixer-upper, you should focus on putting the most money into the parts that matter the most to you. For instance, you might be fine with a basic and simple kitchen if you do not cook much anyway, but if you love to pamper yourself in the evenings, you may want to dedicate some extra funds to the bathroom. And if you are planning to sell, start with home improvements that will add the most value to your property.
Location is one of the most significant factors for many people looking to buy a house. Even if you manage to buy seemingly the best fixer-upper possible and bring it back to its former glory, the wrong location can jeopardize all your efforts. For instance, it is better to stay away from properties located near busy highways or intersections, across the street from an abandoned house, or close to an entrance to a landfill.
If you want to buy a house in an attractive location, you will need to do some research into the local market. It might take some time, but it can really pay off. Even if you decide to sell in the future, you should have no issues with getting your money’s worth for such a house. So, look closely at local market trends and pay attention to the strength of the local business. You should also see what kinds of amenities are available and talk to the locals to check whether the neighborhood is considered to be safe.
Getting at least one experienced and reliable home inspector to take a closer look at the property that you want to invest in is incredibly important. Not only will the professional be able to notice any structural issues that you might not be able to spot, but they will also provide you with a report with all of the fixes a home requires, including the easy and the more demanding ones. You can use this report to put a price on your project and prioritize different tasks.
For instance, at first glance, you might think that the roof is in acceptable condition and can wait, but the inspector might deem that it needs to be repaired immediately. You also might need to be prepared for some disappointment because the inspector might find things that will turn out to be complete deal-breakers, such as serious structural problems that you will not be able to afford to fix.
To sum up, in real estate, nothing is really guaranteed, and this is especially true when it comes to buying a fixer-upper house. Big imagination might simply not be enough to make a wise financial decision here.
If you are thinking about buying a fixer-upper home, you might want to keep the above tips in mind. Remember that it is important to have a realistic budget adjusted to the results of a professionally done home inspection, and do not underestimate the importance of the right location. All in all, no matter whether you want to live in your fixer-upper or plan to sell it for profit, approach this challenge with care and caution. Good luck!
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