Want a Fixer Upper? What You Need to Know
It’s no secret that the housing market has been challenging for homebuyers over the past year. Houses are priced high and often sell quickly, making it hard to find a home that checks all of your must-have boxes — especially one that is available long enough for you to even see it! Because of these restraints, you may be tempted to buy a fixer upper. With less competition and a lower asking price, a house that needs a little love is a welcome alternative to one that is move-in ready.
Five Tips for Tackling a Fixer Upper
However, the purchase of a fixer upper requires careful consideration, particularly if the house is over a decade old. Here are five things to keep in mind:
Don’t focus too much on the discounted price: A fixer upper may seem like a steal, but it’s important to factor in the estimated cost of renovations. If you’re planning to spend $100,000 on updates, keep that in mind as you determine your offer.
Think about the future: It’s important to have a plan for what you’ll do with the house when renovations are complete: Will you sell, rent, or live in it yourself? If you purchase it to sell or rent, make sure your choices align with the needs and likes of the typical buyer or renter in your area. Remember that you’ll benefit from natural real estate appreciation if you hang on to your purchase for a few years.
Determine the project scope: A fixer upper can range from a house that requires a few cosmetic updates to one in need of a complete overhaul. How far are you willing to go during renovations? Houses with noticeable updates often have hidden issues as well, like problems with the electrical, plumbing, and HVAC systems.
Include potential issues in your budget: As a general rule of thumb, renovations typically exceed their project cost. For instance, the average cost to repair a foundation is around $4,500, but major problems with it may cost more than $10,000. Having a buffer when it comes to budget can help your plans stay on track. Note that renovations often exceed their timeline too.
Make changes that add value: Be thoughtful as you plan your house updates. A small kitchen remodel costs around $26,000 and gets back 72.2% of the cost in resale value. Or if you have a room that looks out into the backyard, push it out! Replace a window with French doors and add a small deck. You instantly increase the size of the “room” and add great value to the house with little expense. For more specific changes, consult your realtor about the latest trends that buyers are looking for in properties.
Let The Urban Dog Group help you with your real estate needs in Orlando and other areas of Central Florida! Contact Christine Elias at email@example.com.