If you’ve expressed any interest in buying a home that you can work on, your real estate agent may present you with one or two fixer upper properties for your consideration. Fixer upper homes can offer good value for certain kinds of homebuyers.
But not everyone should buy a fixer upper. Here are some considerations to keep in mind.
There May Be Unforeseen Conditions
Until you actually get in there and start renovating, you cannot know exactly what is behind those walls. Fixer uppers could have unforeseen conditions that could blow away your renovation budget.
If you do decide to forge ahead with an offer, consider hiring a structural engineer, a pest control technician and a mold expert to carefully inspect the property first.
Will You Be Able To Live There During Renovations?
Sometimes a fixer upper requires a complete overhaul. Other times there are a few inhabitable rooms you can stay in while completing the rehab.
Consider whether you and/or your family can be comfortable during the work, or if you will need to rent an apartment or stay with family.
This will heavily impact your fixer upper experience.
How Handy Are You – Honestly?
This is the time to be really honest with yourself. How much of the work can you actually do? Are you a wannabe handyman, or do you truly possess the skills and experience to complete quality work? If everyone you know is astonished that you want to work on a fixer upper house, it is a smart idea to take stock of your abilities.
Can You Afford To Hire Workers?
Just because you buy a fixer upper does not mean you have to do the work yourself, either. Maybe you have the money to hire a contractor or workers to get the job done. If hiring others is part of the plan, make sure you budget accordingly. Do not forget to budget for the unexpected because with a fixer upper, you can expect the unexpected.
Finally, if the only house you can afford is a fixer upper and you really want to buy now, then maybe you should go for it. After all, when you finish the rehab, you could be in a position to take some equity out of the house after a new appraisal.
For the right person in the right circumstances, a fixer upper can be a viable choice.
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About the Author:
Babak Moghaddam graduated from University of Southern California in 1985. He entered the mortgage industry as a compliance auditor at the Bank of New York in 1986 and completed his masters in Business Administration two years later. After seventeen years in the traditional mortgage banking world Babak finally transformed this vision into his own practice in 2002 when he formed Charter Pacific Lending Corp, a mortgage company that has provided over $900 Million in residential real estate loans throughout Southern California. Babak and his team do things a little differently than other mortgage providers. They work as financial advisors, because they have come to realize that a mortgage is a very powerful financial tool. And just like any other financial tool, it should be managed as part of the overall financial management plan to reach every home owner’s long and short-term financial goals much faster. You can contact Babak for a free consultation and strategy session at (800) 322-1217 X103.