Navigating buying a fixer-upper a Fixer-Upper
Popular remodeling shows on TV glamorize the before and after of fixer-upper projects. Buyers are thrilled at the potential for hefty profits. And agents who identify the hidden gems can be seen as having a special talent. To the unwary, the right fixer-upper appears to be a moneymaking no-brainer. In reality, though, buying a fixer-upper takes considerable time, money, patience, and a real estate agent who understands the process.
Here are a few things to consider before putting an offer to buy a fixer-upper.
Do a deep dive into the existing market to determine what type of home is selling. Understanding where potential buyers are willing to put their money will help to clarify if your buying a fixer-upper has the potential to offer a good return on investment.
Know your financial limits. Industry experts suggest adding an extra 20% to your home-buying budget. To keep your financials in check, understand the difference between what improvements are necessary and what you simply want to do. Then, line up reputable, dependable contractors well in advance of your ideal start date.
Work with the right agent, inspector, and even an engineer who can properly evaluate the major components of a house. “You want to have someone look at things like the overall structure of the home, crawlspaces, insulation, and especially the foundation,” said Mina Starsiak Hawk of HGTV’s Good Bones. “If the property doesn’t have a good foundation, it may not be the right one for you because it can end up being a money pit.”
Overall, buying a fixer-upper can bring considerable financial gain and a tremendous sense of personal accomplishment. Just remember to do your homework before you do the work!