Is a Fixer-Upper Right For You?
When the markets skew in the favor of sellers, buyers looking for homes will often look for any way to save money on their purchase. When you don’t want to miss out on a great opportunity regarding neighborhood, school system, land acreage or amenities; homes needing some (or A LOT) of TLC may become attractive to you. While the savings can’t be denied, there are several factors to consider when purchasing a home in need of some love. Let’s consider some significant ones:
First Off, what is the level of the damage? Are we talking cosmetic items like fresh paint and new carpet or are we jackhammering down to the studs? You need to consider the size and scope of the project realistically and factor it in to the cost of the home. As elementary as this may sound, some people don’t do it and end up overwhelmed and financially worse off than if they had purchased something near to or completely move-in ready. While it’s no longer possible to finance the money as part of your mortgage (you’ll need a private loan or home equity loan if you don’t have cash in hand), the cost of the projects required need to be included when you are considering the overall total cost to own the home.
Can you do any (or ALL) of the work yourself? If you’re purchasing a fixer-upper mainly to save money, it is very helpful to be able to do some to most of the work required yourself. An honest assessment of the skills possessed by you and your family must be made. This is especially important when moving beyond the fairly simple things like painting and replacing appliances and fixtures and entering the realm of hanging drywall, laying flooring and updating utilities. Again, be sure that you are experienced with the items you plan to fix- no one I know likes calling a professional out to fix their “repair” after they have somehow made it worse!
Are you ready to live among the chaos of your remodel or not be able to move in until it’s finished? All the while being fully aware that many projects do not come remotely close to meeting their scheduled deadlines due to an array of unforeseen things? Depending on your personality, family size, and stage of life something like this can be mildly disruptive to downright invasive. Take a realistic look at what level of stress this may bring to you and your family, whether you stay in the home or live in alternative accommodations until project completion.
It all comes down to the asking price vs. the condition and work you expect to do, or hire out, to make your home the inviting and warm environment you want for your family. This decision requires a truly unbiased assessment of the costs and time involved- ask for outside eyes and ears if you need to (especially ones with professional experience in the areas your home needs work).If you decide to go forward, embrace it fully and celebrate the incremental progress made. And it’s not all bad news, either: once you’ve finished, you’re enjoying not only a lovely new living space but you have gained something else valuable: near-instant equity in your property. And who doesn’t love that???