What You Need To Know About Buying a Fixer-Upper
Older resales that require remodeling are known as fixer-uppers. These houses tend to appeal to buyers because they’re in established neighborhoods, selling below market value. The potential return on investment once you’ve “fixed up” one of these properties can also be significant. Do you have your eye on a fixer-upper? Here’s what you should know before buying.
Count the Costs
Don’t assume that a fixer-upper in a great neighborhood is automatically a win-win. You’ll need to consider the full costs of renovation with a thorough investigation into the condition of the property. Factor in all materials, labor and full costs to remediate and repair problems identified by a professional. Once you’ve got a good number, compare that to the market value of similar properties in that neighborhood. Add in 5 to 10% of costs for unforeseen issues and inflation.
Check the Renovations
Ideally, a fixer-upper with cosmetic issues would be best, but even in that case not all upgrades are created equal. For example, you may only need to repaint cabinetry and replace hardware to update your master bathroom in one older house. In another property, you may need to change out plumbing, pay for sewer line leak repair Jacksonville FL and replace all the fixtures to do the same.
Consider Sweat Equity
If you’re into DIY projects, you may be able to save money on remodeling. Carefully consider what you’re truly capable of as errors and omissions can lead to costly repair and rework, eliminating potential savings. Recognize that some things such as electrical rewiring usually must be completed by an experienced pro.
Your dream home may exist as an older house that needs some fixing up. Many have invested time and treasure into a fixer-upper that brought significant returns. Be sure to investigate fully and go in with a clear idea of costs and potential outcomes.