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What To Consider Before Buying A Fixer Upper Home
Purchasing a fixer upper home can be a wonderful investment, but only if you pick the right one!
In a housing market that’s more competitive than ever before, home buyers have started setting their sights on fixer upper homes. These homes are typically less expensive than new houses, and you will likely have less competition when you submit your offer. Since you’ll be spending less to buy the home, you’ll likely be able to put more money into making the property your own and can go into the remodeling process with a vision that makes you excited. However, you want to put in the prep work before you purchase the house to make sure the house you choose is a suitable palate for executing your design concept, and you won’t find any unpleasant surprises once construction gets underway.
Will the neighborhood provide a good return on your investment?
Location is always one of the most important factors when purchasing a home, and that includes fixer uppers. When you invest in a home that needs some TLC, rather than a move-in ready property, you have a great opportunity to add value to your home and earn a sizable profit when it comes time to sell later. Signs of a good neighborhood include the presence of excellent, accredited schools, low crime rates, and nearby homes that are well maintained and attractive.
If you’re unsure if the neighborhood is right for you, consult with a local real estate agent who is familiar with the area. Your realtor will also be able to do research into what homes are selling for in your prospective neighborhood, and if prices have been rising or falling in recent years to give you an idea of how your home’s value could change in the future. You may also want to avoid neighborhoods where housing prices seem to have already peaked, and therefore won’t be rising further in the foreseeable future.
Get professional opinions in advance.
As you are putting together your budget to remodel or renovate your fixer upper, seek professional advice to get estimates about what the repairs or remodel may cost. Before you commit to the house, hire a contractor to help identify and price out repairs. In addition, schedule an inspection with a structural engineer who can identify problems with the home’s foundation and structure. If you are looking for a fixer upper that only needs cosmetic repairs, you may not want to deal with a home that requires complicated and pricey work to fix the foundation or structure. Lastly, make sure to hire professionals to do inspections to check the condition of the home’s drainage, electrical systems, plumbing, HVAC system, and roof, as these repairs are often the most costly and can add up quickly. If you are unsure about a specific professional or their pricing, you are also allowed to seek second opinions and compare different quotes.
Check for restrictions that could halt or prevent construction.
Before purchasing a home, make sure you will be allowed to execute your vision to make it your own. If you are moving to a community with a Homeowners Association (HOA), you may have to have any plans to remodel approved before you are allowed to begin construction. Make sure you understand what the HOA allows and what the approval process entails in advance.
You will likely need to take at least one trip to City Hall to obtain construction permits and learn about the permit approval process. While you are there, you may also want to check if the home you are interested in is considered to be historic. If so, there may be restrictions as to how and what you remodel in the home. Every municipality has different rules and regulations for renovating historic properties, so you’ll want to schedule a meeting with your local historic commission or conservation commission as soon as possible to find out what is and isn’t allowed.
Understand the stakes.
Before committing to a major remodel of a fixer upper home, make sure you understand the stakes. You need to be prepared to go over your budget, deal with annoying delays, and handle unexpected issues and conflicts. While the process will almost certainly be stressful at points, the pay off is you get to choose where your money goes to turn the fixer upper into your dream home and truly make it your own.
Prepare for excitement!
Once you’ve chosen your fixer upper home, all that comes next is preparing for a very hectic and exciting time in your life! Enjoy the process of picking paint colors, reviewing plans, selecting new features and appliances, and daydreaming about your dream home and garden. In addition to finalizing your plans for the remodel, start making friends with your neighbors before you disrupt them with your home construction. They’ll likely be more understanding and welcoming if they have a heads up as to what’s coming.