Buying a fixer upper can save you a lot of money compared with a move-in-ready home. However, it can also be a ton of work. And your fixer upper could wind up costing you more money if you have to hire out all the work or run into hidden problems. To make sure you make a good investment, there are some things you should know before buying that fixer upper.
Know what work needs to be done
The value of a fixer-upper is in the discount on the sale price compared with the amount of work that needs to be done. If you are considering buying a fixer-upper, have it thoroughly inspected, including specialized inspections for termites, mold and radon. Such homes can often have hidden problems because of their age or due to lack of owner care. For example if their is a leak or mold in the roof. You’ll need to talk to a certified roofing specialist. If you can’t inspect the home because it’s a tax sale or foreclosure, see if there are any records you can check, such as building permits or code violation, to find something out about the home’s condition.
Know what you can do yourself
The big savings with a fixer upper is performing work yourself. If all your fixer upper needs is cosmetic changes, such as new carpet and paint and new appliances, you can probably do a big portion of the work yourself, especially if you have experience with home renovation work. On the other hand, if the home needs extensive work, such as new plumbing, electrical system, or a new roof, you are probably going to have to hire professionals like Seneca Creek Roofing.
Know how much the work is going to cost
If you are going to have to hire a lot of the work out, you want to have an idea of what it’s going to cost. Ask to bring contractors into the home to get estimates before you sign a contract to buy the house.
Understand the neighborhood
Part of a fixer upper’s value comes in its location. A run-down old home in a desirable neighborhood has more potential than a run-down home in a neighborhood full of run-down homes. Whether you plan to own or rent, you want to know that your investments will pay off.
Know your financing options
Depending on the home’s condition, you may not be able to get conventional financing, so check into government rehab loans. Even if you are paying cash for the home, you may need to finance renovations, so make sure you have a plan for that.