Many folks, especially first time home buyers looking to get the most for their money are considering fixer-upper homes. Unless you are an experienced contractor or investor with plenty of home rehabbing experience under your belt, here are a few tips to not losing your shirt in the process of buying a fixer-upper home:
Always have an inspection – There is nothing more important than an once-over by someone trained and experienced in inspecting homes and identifying possible problems. Don’t try to save a few dollars by skipping this step, or by having a friend or family member do the inspection instead of a professional!
Consider your financing – Not all loans will work for a fixer upper home. Some loan programs will have strict requirements for property conditions. Before assuming your loan will work for any home, have a conversation with your lender. There are special loan products available that will include the cost of rehabilitating a home. If you intend to look at homes that need work, look into these loan programs before you start shopping.
Don’t overestimate your own abilities – Unless you’ve replaced kitchen cabinets, installed ceramic tile, repaired plumbing, etc don’t assume you have the skill or the time available to do major home repairs yourself. Even if you are able to successfully able to get through these projects, the finished product is often less than stellar. There’s nothing worse than poorly done DYI home improvements.
Don’t underestimate repair costs – While an inspector can identify issues, you will want to have licensed experienced contractors out to take a look at the work needed and give you quotes. Keep in mind surprises have a way of popping up during remodels, and they are usually not good ones. Add a cushion to the repair budget to allow for these surprises.
Get a good Realtor – A local, experienced real estate agent with knowledge of rehab property and experience helping homeowners navigate their purchase of fixer-upper property is an invaluable resource in this home search!
Last Updated on September 15, 2017 by Minna Reid