Thinking About Purchasing a Fixer Upper?
Yes, affordability seems to be an issue right now, but it doesn’t mean you have to put your plans to buy a home on hold. There are options!
If you’re willing to use a little elbow grease (or hire someone to), buying a house that needs some work could make the difference when thinking about buying on a budget.
Here are some things to know when deciding if buying a fixer upper is the right move for you:
Not sure what a fixer upper is?
A fixer-upper is a home that is livable but requires some renovations and/or repairs. Maybe what’s needed is cosmetic updates like painting and new flooring. Perhaps it’s more extensive repairs like replacing a roof or updating the plumbing or HVAC.
While fixer-uppers need a variety of TLC, this is why they may be worth considering, especially right now:
They are usually less money: Because of the repairs and updates that may be involved, these homes are usually less expensive than a home that is ready to move in. Fixer-uppers come with a lower price tag. This makes them an option, especially if you’re having trouble finding anything in your budget.
There is less competition to buy: When you’re ready to make an offer on the fixer upper, you’re less likely to have a lot of competition from the buyers who are focused on buying a move-in-ready home.
You can build equity fast: A fixer-upper not only lets you design the space according to your needs and style, but with smart renovations you’ll increase your home’s value faster and potentially see a big return on your investment in the future.
What To Know About Buying a Fixer-Upper
There are exciting possibilities that come with buying a fixer-upper, but here are a few things to think about:
What is our plan? Do you have the time, skills and/or the budget to complete the repairs and renovations that are needed? What can you tackle yourself? What will you have to hire out? Will a fixer-upper be a good fit for your lifestyle? … because you’ll likely be living in a construction zone for a while.
Don’t stress. You can do the updates gradually. They don’t all have to be done up front if you’re willing to be patient. You can space out the renovations over time in a way that makes sense for your budget and what needs to be taken care of first.
Since location does matter most, you’ll want the money you’re spending to fix up a house to be worth the investment. Make sure the home is in an area with solid and increasing home values and the amenities that people love, like restaurants and shopping.
Get a home inspection. Hiring a licensed inspector to do a thorough inspection before you buy is a must. What they find will help you know what needs to be updated so you can research renovation costs and know if it’s a project you can or want to take on.
Renovations rarely go as planned. Be sure to set aside extra money to cover things like extended repair times, increases in the cost of materials, or other unknowns that may come up- which frequently happens with a fixer upper.
Talk to a lender. There are renovation mortgages out there that are designed for homes that need work. You’ll want to seek these options out and know that they may have requirements like spending and timeline limits. A trusted lender will help you understand all the ins and outs to a renovation mortgage.
Summary: Fixer-uppers aren’t for everyone, but if you’re open to doing some work, a fixer upper can be a great way to combat today’s affordability issues because you can possibly find something in your budget. With careful planning, you’ll turn a less-than-perfect house into the perfect home for you.
If you’re considering a fixer-upper, give us a call. We can help you find the one that fits your budget and goals.
