Buying a fixer upper can be nerve-wracking. Tips for buying a fixer upper can take some of the stress out of the process. If you are someone with a vision that you think you can apply to a great real estate deal, these tips for buying a fixer upper are a good place to get started.
Buying a fixer upper is not for everybody. Many buyers prefer the turnkey approach to homeownership. However, there are plenty of people out there that will be grateful to have these tips for buying a fixer upper.
Why Is a Fixer Upper a Good Deal?
Following these tips for buying a fixer upper can help you to ensure that you get the deal that you are hoping for. Most people decide that they are going to buy a fixer upper because it is the more cost-effective option.
The old real estate mantra about buying the cheapest house in the most expensive neighborhood is what draws people to the less expensive fixer upper. If you can do some of the needed work yourself you can literally shave thousands of dollars, sometimes tens of thousands of dollars off your home purchase.
However, there is a darker side to buying a fixer upper. If you do not know what you are getting into that fixer upper can turn into a money pit pretty quickly. Following tips for buying a fixer upper can help you to make better decisions about whether or not the investment is worth it, and whether you will get the ROI you expect.
Of course, money is a huge motivator but it is not the only one. Some people are drawn to buying a home that needs some work because they like the idea of creating a custom space that fits their needs perfectly. For example, some buyers cannot find a turn key property with everything that they want in the home, starting from scratch with a fixer upper is more appealing to them.
There are some simple tips for buying a fixer upper that you can follow that will help you to make the best choice whether you are looking to save on the purchase price or you want to have a clean slate to work with. In all cases, you should never go in blindly.
Good Bones Are a Should Have
The first tip for buying a fixer upper is a pretty standard idea. Good bones are a must. What does that mean? It means that you can fix just about anything cosmetic, you can manage things like new plumbing fixtures to update the bathrooms, but you should be wary of homes that have structural issues.
There is a huge difference between some foundation work and a house that is sinking on one side because the foundation is failing. The difference can usually be gauged in costs. It is far more expensive to start fixing up structural issues than it is to deal with other problems you may come across in a fixer upper.
Plumbing services typically are a normal part of transforming a fixer upper, jacking up the house, and trying to fix the foundation problems is not. You have to gauge how good the bones are before you make a decision about whether or not this it the right fixer upper for you.
Plan for the Unforeseen Problems
You hear stories all the time about people that were rehabbing a home and ran into one problem after the next. One of the most important tips for buying a fixer upper is centered around planning for the worst and hoping for the best.
Here is a scenario, you notice that one of the window sills seems to have some rot going on. You call in roofing services because you think it must be water damage from a roofing problem, but the roofers tell you your roof is fine.
That bit of sawdust you saw laying around the window sill becomes more of a mystery. You get to the point where you were hoping it was the roof just to be able to have an answer. You find out after you see other damage around the house that you have a termite problem.
Termite treatment can help deal with the issue but you will also have to deal with all the damage that you did not notice like in the basement or the crawlspace. Planning and budgeting for the things that you do not know about the house is just as important as planning for the things that you do know about the house and want to repair or change.
One of the problems with a fixer upper is the “as is where is” clause. You are getting such a great deal because a lot of what is happening with the house is not being disclosed in many cases. It does not have to be disclosed if that “as is where is” clause is added to your contract. The only solution you have to ensure that those unknowns can be dealt with is to make sure you have some money put on the side for “emergencies” as they crop up.
How Can I Save Money On a Fixer Upper
How much fixing actually needs to be done to make your place inhabitable? In many cases, you can live in your fixer upper as you fix it up, in other cases, you cannot. One of the best tips for buying a fixer upper and how to save money in the process is to assess the needs of the property and start with the biggest problems first.
Why is it important to prioritize the bigger jobs first? Let’s say you are working within a budget, who isn’t? There are things likely on your list that have to be done to make the home livable, and things that you would like to do to make the home more comfortable. Making it safe and livable needs to take priority.
Getting the more expensive things done that are focused on the safety of the home is vital because if you run out of money you can live in a home that does not have seamless flooring, but you cannot live in one that is unsafe.
For example, if you have to choose between air duct sealing to keep debris out of your HVAC system or painting the walls, go with the air duct sealing. It will make your home safer and protect the HVAC system.
You can always live with the ugly walls until you can hire a painter down the road, or you can just paint it yourself. DIY projects are a great way to cut costs.
While you cannot do everything on your own, you can do a lot of the work on your own. In many cases, it will be cost-cutting for you to buy your own materials and hire a professional to install them. Of course, things like bark dust installation or roofing should be left to the pros, but there is a lot for you to do to save on costs.
A lot of people that buy fixer uppers like to follow tips focused on ways to save money without cutting corners on quality. Here are some tips for buying a fixer upper and saving on fixing it up:
- Know your limitations. Sure, DIY can be fun and it can save money, but do know your limitations and do not be afraid to get professional help. Sometimes DIY can cost you more than paying for professional help in the first place.
- Make a budget and stick to it. If you have to cut corners, cut them in the cosmetics department. Instead of paying a boatload of cash for upgraded paint, carpeting, or other materials, consider stepping down a bit to save and keep your budget on track.
- Put your money where you will get the most ROI. Kitchens, bathrooms, and even landscaping can up the value of your fixer upper fast.
Tips for buying a fixer upper are all about balance. Balancing the amount and type of work, balancing your budget, and balancing your expectations based on the type of work and budget. You do not want to sway yourself out of balance with your fixer upper because your vision dictates marble floors but your budget dictates vinyl.
Hire Experts For These Jobs
Some fixer uppers come with some unusual built-in problems. For example, a barren property is not unusual. The previous homeowner may have just completely clear cut around the property and left you with a clean slate, but especially with larger properties, it looks naked. A revegetation specialists can help to reintroduce native vegetation to your property which is something most people are not well versed in. The point is you have to know when to call in the experts.
Let’s say you are halfway through your renovations and a hurricane comes blowing through, your home sustains storm damage. Now you have a home that is only halfway finished that also has sustained additional damage. Which way do you split yourself? Do you keep moving forward with the renovation or do you address the damage?
What you do is hire a company that specializes in storm damage services to manage the storm damage problem and you keep moving along with the renovation. Time is money, and you cannot afford to get sidetracked. Hopefully, the insurance will cover the costs of the storm damage repair and get you off the hook for the costs. Keep in mind that insurance cannot typically be used retroactively; trying to get money for past problems has the potential to land you in jail. Bail bondsmen can get you out of the cell, but you’ll still have to pay for the repairs to your home.
There is a litany of problems that are best left to the experts like:
- Complex electrical work. Most people can install simple electricals like switches, ceiling fans, outlets, and other non-complex electricals. However, the complex stuff like installing a new circuit breaker box should be done to code by a professional.
- HVAC systems. Installing a new HVAC system is something you also should leave up to the pros. You need that warranty in place and you want to make sure it is done right.
- Foundation and structural repair. Remember we talked about one of the first tips for buying a fixer upper was to avoid properties that have foundation problems, if you did not follow that tip, and you need foundation repair, let an expert do it.
Basement waterproofing, septic system installation and repair, and more are jobs that are big and require specialized skill sets and equipment to do right. Leave those jobs up to the experts.
Cosmetics Can Be Fun
Ideally your fixer upper has come with just cosmetic issues. Cosmetic issues can be simple like terrible paint, or paneling on the walls, ugly old carpeting, maybe some damage to the ceiling and walls. It is easy to repair and it is something you can do pretty much on your own.
The top tips for buying a fixer upper all agree that if you can find a place that just needs some TLC and some upgrades that are the way to go. Transforming a house that just needs some cosmetic attention is easy and typically very affordable.
Ugly houses are not appealing to those people that are looking for that turn-key move-in ready vibe, but are a huge pull to anyone that wants to save some money and will enjoy creating a space that is uniquely theirs.
Tips for buying a fixer upper with cosmetic issues include:
- Choose a house with a footprint that you can live with. When you start changing the footprint of a space around you start racking up the costs. If you can find a fixer upper with a footprint that you can live with, then your rehab with be easier and less expensive.
- Use your vision. Ugly can be hard to get past, but imagine that dining room with a cool gray instead of that pumpkin orange. There are apps that you can use that can show you what a space can look like with a few changes to help further your vision.
- Don’t buy a fixer upper based on the idea that you can throw an addition on it to make it big enough for your family. Additions are great but the potential of adding an addition should not be the driving force behind your decision making.
Go into buying a fixer upper with your eyes wide open and you will do great.