We all love seeing those renovation shows on HGTV, but the process in real life is a little more complicated. You don’t want to buy just any fixer upper. Here are three crucial things to know when buying a fixer upper to set you up from success.
Crucial Things to Know When Buying a Fixer Upper
Shop Based on Resale Value
One of the most crucial things to know when buying a fixer upper is to shop based on resale value. While everyone’s priorities are slightly different when buying a home, resale value is often a good place to start. You want to invest in a place that when renovated, will sell at the highest mark. Here are two indicators to keep in mind.
- Location: Location is king. Time and time again you’ll hear people talk about their long commute to work, or that they would prefer to live closer to their kids school. You can change a lot about a home, but you usually can’t physically move it. Look for a fixer upper in popular areas or good school districts. These homes are most always in high demand.
- Layout: Yes you can move walls, but it gets expensive quickly, and takes a lot of effort. Look for fixer uppers that have functional layouts that allow you to keep walls more or less where they are. Open layouts are popular for home buyers today, so keep that in mind when buying a fixer upper.
- Know your budget and prepare to go over it: Once you have quotes in place, take a hard look at your budget, and establish a budget cushion in case you encounter an unexpected expense. Often times when you start one project, other problems occur which bring up extra costs.
Include Inspection Contingencies
While inspections are optional, with a fixer upper, it’s strongly advised you use one. Conducting a home inspection is the chance to bring in a professional to tell you exactly what’s wrong with the property and what work needs to be done to bring it up to code. This is also a chance to evaluate if the work becomes too expensive for you to handle, a realization that’s better to have earlier rather than later. As long as you tell the seller your intentions within the proper time frame, these contingencies will allow you to walk away from the property with your deposit.
Know Design Trends
A big part of buying a fixer upper is knowing what designs are popular. If your goal is to buy the home and quickly resell, it’s important to cater to the public’s desires. For example, white cabinets and counters are very popular right now, so painting your cabinets a walnut brown will probably not be a favorable choice for many buyers. As long as you are going to all the effort of renovating, make sure the home design caters to the public so you can resell at the highest dollar.
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