With spring home buying season well underway, it’s time to tackle a popular topic in the real estate industry: buying a fixer upper. If you love old houses and consider yourself even somewhat handy, the idea of a fixer upper can be irresistible. You can snag a rundown property in an ideal neighborhood at a low price. After you invest some money and time into renovations, you’ll end up with a home that’s often worth twice what you paid for it. Unfortunately, this process often leads to stress, stress, and more stress.
To avoid the potential hassle and reap the benefits of buying a fixer upper, here are five tips to consider.
1. Check the ceilings.
Look for stains on the ceiling and other possible signs of mold. If you can, access the attic and do a thorough check. You may even want to hire a professional to take a look! Water damage is often a big red flag that the roof needs repaired or even replaced, which can cost as much as 100,000 dollars to fix.
2. Shop for secondhand items and materials.
Renovation costs are on the rise, but there are some simple ways to save money. You can shop at local thrift stores or salvage yards for cabinet hardware, bathroom vanities, mirrors, and more. Check your local lumber yard or old sawmills for raw materials to use during your updates.
3. Know your capabilities.
It’s no surprise that a fixer upper is most cost-effective when the homeowner pitches in! Try to DIY as much as possible, whether it’s replacing the bathroom tile, hanging new cabinets, painting the interior walls, or adding curb appeal. If you can’t complete a project yourself, it’s important to closely supervise the licensed contractor(s) you hire. If a project goes over budget due to mistakes or delays, it’s your bank account that’s negatively impacted.
4. Consider the updates needed.
You want to tackle projects that pay. Cosmetic improvements — like drywall repairs, paint touch-ups, and floor refinishing — often cost much less than what they return in market value. Other smart improvements include updated bathrooms and kitchens as well as new light fixtures, doors, siding, and window shutters.
If big additions and/or structural improvements are needed, it’s important to be smart about your renovations. While most additions cost as much as or even more than they return in market value, adding a bathroom can be worth twice as much as the cost. When it comes to structural updates, try to fold in cosmetic improvements as well. For instance, if the roof needs to be replaced, why not add a skylight or two to bring some natural light into the kitchen?
Finally, don’t over improve! You don’t want your investments to raise your home’s price any more than 10 to 15 percent above the median sale price of comparable homes in your areas. Consider how long your renovation will take and how much the market could change in that time too.
5. Expect the unexpected!
Lastly, be prepared for things to veer off course a time or two. Add an extra 20 to 25 percent into your budget for surprise issues that may pop up. For instance, due to hurricanes, new windows are a common upgrade in Central Florida homes. Depending on the size of your house, this added expense can cost between 50,000 and 100,000 dollars.
Let The Urban Dog Group help you with your real estate needs. Contact Christine Elias at caerealestate@gmail.com.