Four Things You Need to Know Before Taking On Your First Fixer-Upper
You’re looking into buying a home for the first time, and you’ve always kind of wanted to tap into that HGTV knowledge you’ve been building up over the years. In other words, you’re considering buying a fixer-upper. Buying an “incomplete” home comes with many benefits. You can usually buy one for a smaller cost, and sometimes realtors will even include a stipend to help cover some of your repair costs. On the other hand, you should also expect to dip into your own pockets and perhaps even whip out the power tools in order to fix up your new home. Here are four things you need to consider before buying your first fixer-upper.
Knowing Good Bones
As you search for fixer-upper properties in your area, you might hear realtors and homeowners talk a lot about “good bones.” Essentially, this refers to whether the home you’re considering to buy has good potential. During your search, you’ll come across a few dilapidated houses with overgrown yards, busted windows, and cluttered rooms. As a buyer, it’s important to look past the current state of the home and consider what it could look like after a little bit of elbow grease. A good tip for homebuyers is to consider all the positives of a rundown property instead of what needs to be improved.
Knowing Your Physical Limitations
Since this is your first time buying and fixing up a home, you need to be honest about your abilities with a hammer and saw. While knowing good bones is important when choosing your next home, you should also keep in mind what projects you can and cannot do yourself. When you’ve narrowed your potential list down to a few houses, you should take an inventory of what all needs to be repaired in each home. Mark which projects you can take on by yourself and which projects need professional attention. You’d be surprised by how many repairs you can make yourself. All you need is to have the right tools for the job and a little know-how.
Knowing Your Financial Limitations
Of course, even with all the drills, sanders, and jigsaws in the world, there will still be some projects that are beyond your beginner to intermediate skill set. When the project requires specialty tools or knowledge, then it’s always better to bring in a professional to get the job done right. Professional help will cost more out of your wallet, which is why you should really consider the financial implications of buying a fixer-upper home. Properties that need sprucing up will generally run cheaper; a fixer-upper property in Middletown, Delaware, averages around $366,000. However, you should expect to spend at least $50,000 more to cover repair costs. The best way to know how much cost you’ll have to eat is by hiring a contractor to get an estimate on how much it will cost to fix a home. Structural repairs will always run the highest, while aesthetic costs will likely be lower but sometimes more numerous.
Knowing When to Flip
After you repair your new home to the point where you and your family can live comfortably together, you have to decide whether to keep or flip your home. Depending how much you spent on the house and for repairs, you could possibly sell your home for a lot more than what you got it for and turn a pretty nice profit. Of course, it’s not always a matter of how much you can make of a flip, but when is the right time to make the flip. The process of buying and selling simultaneously is a tightrope that can be tricky to navigate. You might need a little time to get your ducks in a row before entering the process again.
So, there you have it. Deciding to take on a fixer-upper can be an extremely exciting time for homebuyers. With a little luck and a lot of hard work, you can pull it off and turn a profit.
Photo Credit: Pixabay.com