Buying a fixer upper has many benefits over the purchase of a move-in ready home that might have fewer problems. Every real estate agent will tell you that any home you move into will inevitably require some kind of improvement work. However, fixer uppers typically need a bit more TLC. This can get quite costly, but will offer a number of positive, and potentially lucrative, advantages in the long run.
Before you call your real estate broker to jump in on that fixer upper, here are five important things you should know before you finalize your decision to buy.
1. Get a Complete Diagnosis
There’s nothing worse than buying a home only to discover than instead of a few minor improvements it actually requires extensive – and costly – renovations. That’s why you need to get a full and complete home inspection before you buy. This will give you a reliable and professional opinion regarding every issue that will need your attention once you start the renovation process.
Realtors can refer a quality inspector during the escrow process that can identify any areas of disrepair – both seen and unseen. This information will help you decide if the house is worth the time, money and effort that it will require to make it the home you want to live in. Find out everything – from the cosmetic to the structural and all other potential issues in between.
2. Know the Commitment
Setting aside the costs for a second, it’s important that you recognize the type of commitment that you’re getting yourself into. Top real estate agents will tell you that renovating a home can be a lengthy and sometimes frustrating endeavor, particularly if you’re doing any of the work yourself. Do you have that kind of time and energy to devote to this? Once you begin fixing up your property it will take up every waking minute you have.
3. Will it Appraise?
You want to be sure that after you put in all of this time and money that the house will appraise for a value that reflects the amount of resources you’ve committed to this project. Find out what the house might be worth once it is in excellent condition from your real estate agent and then decide if your contributions will yield a smart long-term investment.
4. Living Space
You need to know whether or not you can live in the house while it’s being renovated or if you’ll need to be sheltered somewhere else in the meantime. If the latter is the case, you should have that worked out with your real estate broker and incorporated into your budget well before you sign any paperwork.
5. Know Your Limits
If you’ve decided you’re going to be doing the renovations yourself, be sure you’re equipped with both the skill and the proper tools to get the job done properly and thoroughly. If you find that you’re having trouble or you realize you’re out of your depth, call a contractor and have the renovations done right.