5 Steps to Purchasing A Fixer-Upper Home

By
Real Estate Agent

5 Steps to Purchasing A Fixer-Upper Home

If you're planning to purchase a "fixer-upper home" and then renovate it, be sure to review the deed, the property survey and the tax value of that property before you make an offer to purchase.  If the deed names a corporation or an "estate of" as owners of the fixer-upper property (which indicates that the transaction may get complicated), if there are covenants (restrictions) on the deed that would limit the use of the property in a way that is not beneficial to you, if there are any problems at all, then you can save yourself lots of time by finding these things out before you begin negotiating.

1. Talk to the neighbors. 
Another good approach before you purchase and renovate a fixer upper home is to talk to the neighbors, who can be an invaluable source of information. They know what that area is like in the dead of winter, in the middle of the night, after a heavy rain, when school is in session, even since the factory closed. They know if there is sufficient parking. They even know where the teenagers hang out, and who has problems with flooding in their basement.

Talk to neighborhood realtors, community leaders, and newspaper columnists who cover your community, PTA presidents, school board members, the local chamber of commerce, and find out what's going on behind the scenes.

Some questions to keep in mind:

 

  • What is the general trend in real estate values?
  • What do the housing-starts statistics look like?
  • Is your area of the state growing?
  • Are businesses (and jobs) moving into or out of your area?
  • What are the demographics (the age and standard of living) of the citizens in your immediate area and how are they changing?
  • Have you been or are you about to be re-zoned by the city or county?
  • Where are the new streets and highways going to be?

 

2. Research government master plans.
Contact the Planning, Community Development, and Housing departments in your local government complex. Meet with the planning personnel in all three departments. Find out if your street is about to be closed, paved or widened, if there is a zoning change coming that would allow a shopping mall to be built across the street, or if your area has been targeted for redevelopment activities.

Find the appropriate web site for your local governing body. Look at any part of the site that will give you more information about changing demographics, zoning ordinances, or special programs or regulations that affect you, your property or your neighborhood.

Also contact your state Department of Transportation and get information about traffic patterns or new highways that are only in the planning stages now.

What would happen to your property value if they relocated the highway about 10 miles further away from you?

What if you found out they were planning to add an exit to the interstate that would direct lots of new traffic through your neighborhood?

3. Learn about the area's sense of community.
Don't forget to consider how well the neighbors get along with each other. Is there a neighborhood association? Do the folks in this neighborhood tend to stay a while and get to know each other, or do they transfer in and out pretty frequently? Your sense of community will be important to you. It may even be more important than any other aspect of your evaluation.

 

4. Review zoning and land use ordinances. 
Contact your city or county Zoning Administrator. Local zoning ordinances will define flood plain status, parking and landscaping requirements, housing density parameters (whether or not you can turn that single-family house into a duplex), and other land use rules.

Zoning maps will provide you with information about any utility lines or other public services or easements that must be kept clear of obstructions. Ask the zoning staff to interpret all of these designations for you to explain how each will help or hinder your plans.

Zoning staff may also be able to tell you something of the history of your property. For example, many years ago it may have been an old gas station, and there may be underground oil tanks on your lot that would have to be removed during your renovation.

5. Ask about special home renovation programs. 

While you're talking to local government planning staff, find out if there are any special home renovation programs available to you that might provide:

  • Low-interest loans
  • Grants
  • Tax incentives
  • Technical assistance
  • Volunteer labor
  • Free paint

 

Your local government staff understands and appreciates that your home renovation will improve your neighborhood, not just your own property. They will often support you if they can.

 
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Re-Blogged 3 times:

Re-Blogged By Re-Blogged At
  1. Will Nesbitt 05/20/2014 06:34 AM
  2. Les & Sarah Oswald 05/25/2014 03:52 PM
  3. Bob Crane 06/01/2014 03:28 PM
Topic:
Home Improvement
Tags:
real estate

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Rainmaker
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Ronald DiLalla
Century 21 Discovery DRE 01813824 - Anaheim, CA
No. Orange Cty Real Estate

Hi Connor,  great advice for those looking to buy in this area.  Thanks for sharing with us.

May 20, 2014 04:46 AM #1
Rainmaker
728,325
Pete Xavier
Investments to Luxury - Pacific Palisades, CA
Outstanding Agent Referrals-Nationwide

Great things to consider when purchasing a fixer upper or any home for that matter.

May 20, 2014 04:56 AM #2
Rainer
198,633
Randy Shamburger
Movement Mortgage - Greenville, SC
FHA, VA, USDA and Conventional Mortgage Expert

Great information, thanks for sharing.

Have a Big day,

Randy

May 26, 2014 01:35 AM #3
Rainmaker
3,266,489
Michael Jacobs
Pasadena, CA
Los Angeles Pasadena 818.516.4393

Hi Connor -- good post with a logical step-by-step approach. Fixer-uppers are definitely not a viable option for everyone but for those who are prepared and able(both creatively and with the necessary funds) there are certainly opportunities available.  

May 26, 2014 11:19 AM #4
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Bob Crane
Woodland Management Service / Woodland Real Estate, Keller Williams Fox Cities - Stevens Point, WI
Forestland Experts! 715-204-9671

Thanks for the research points Connor, things that most do not think about when purchasing a home.

May 26, 2014 03:07 PM #5
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Rainer
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Connor Dowd

2013 Newport Realtor of the Year
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