While reviewing a sellers’ bungalow built in the 1900s our inspector discovered “issues” that could be of concern depending on the objectives of the sellers and their potential buyers. Were the sellers interested only in a cosmetic update? Would buyers plan to live in the home as they remodeled it? Or, would buyers need to plan for a ‘Gut Rehab’?
Major Rehab: These sellers would leave the major rehab to buyers. They had ball parked the cost for major improvements including:
holes in basement
musty smell and odor of oil permeating the house
an ancient oil tank
a new roof
hazardous materials abatement
insulated exterior walls
a new HVAC system
(in the cooler months the heating bills at this Asheville bungalow were almost $400/ MO!)
big updates on the plumbing, and electrical systems …for example.
The sellers would leave dealing with the “Big Ticket Items” found in many older buildings to future owners. The new owners could worry about materials and contaminants such as lead paint, asbestos, mold, pesticides, and coal dust. After all, the house was a rental property. (we could see that it had not been properly maintained over the years.) The college kids who had lived there had complained of air leaks, but fixing this was not on their agenda. Surely, future owners would want to do something about this. (In this bungalow, for example a more efficient building envelope could provide way more comfortable living.)
Cosmetic Update: But the sellers were on a budget. They chose to invest less than $3,000 in a cosmetic update. They had been told that buyers, seeing granite countertops, and stainless steel appliances, and a new coat of paint might “fall in love” and be swayed to move right in.
Real Costs: Would such buyers realize the serious expenses, time, and energy involved in bringing this older bungalow up to today’s standards? Would they figure into their spending plan another $ 50,000. to 100,000. in addition to that “very reasonable” listing price?
NOTE: Asheville bungalows in walkable neighborhoods with cosmetic updates do sell for “reasonable prices”… however, buyers may choose to consider “real cost” caveats…
Real Estate STATS:
Asheville Bungalows (NOT Energy Efficient- add rehab costs )
In “Reasonable “ Price Range of $150,000 to $250,000 On Market: 50
Healthy Built Homes on the Market: 16
Price Range: $150,000 to $380,000 (subtract rehab costs)
(c) Bungalows -Spruce Up? Rehab? or Green-Up? Ashevile Style-A1031 Realty, Inc. Asheville, NC