What is a Fixer Upper home?
Whether it’s been through pop culture, the news or even your neighbor you are bound to have heard the term “fixer upper” before, there is even a reality tv show dedicated to such houses. In the rare case that you haven’t heard of them before or truly understood what they entail, the name quite frankly gives it away. A fixer upper is blatantly a property that is in dire need of some fixing. Now, this fixing is inclusive to everything and anything. It could be paint, landscaping, pipping, electrical, the possibilities are endless. Don’t let the mere thought of all the possible fixing scare you away as there are benefits to purchasing such a property.
With such a house you can decide where you want money spent on as the place will be your blank slate to do whatever you want with. Whether it be through the creation of an incredible kitchen or a gorgeous living room, you get to decide what happens where. Through turning nothing into something you have the possibility to make a profit off your renovation. People actually make livings on flipping fixer upper homes. For example, they will buy a fixer upper for $200k, put $50k into it and then put it back on the market for $300k resulting in a $50k profit. Now that living style isn’t quite for everyone as fixer uppers can be wild cards.
Now to make you aware of the fallbacks of a fixer upper, majority of the time they aren’t ready to move into as there could be some substantial renovations needed to make it livable. When determining the renovations needed a home inspector will become your best friend and possible life saver. A home inspection prior to even considering submitting an offer will let you know of things in dire need of renovation that you wouldn’t be able to realize yourself. Without a home inspection you could be falling down a financial black hole. Some of the more important components include plumbing, air conditioning, roofing and foundation.
Additionally, home inspectors can give you a ballpark number for the cost of all the renovations. Thus, allowing for you to ensure your finances can support such an endeavor. Given you have weighed the essential pros and cons of a fixer upper, you should also factor in what you can do yourself and what you would need done by a professional. If you can do majority of the renovations and only need to spend money on the materials, then you would be saving a great deal as you wouldn’t have the need to pay someone else. On the other hand, if you don’t think you quite have the skills to tackle such a project and will rely on others work most of the time, then perhaps a fixer upper isn’t for you. If you end up paying someone else for all of the work that is an additional cost that might end up washing away any profit you could have made when it comes to resale.
If you do possess the skills to accomplish most of the renovations yourself, do you have the time? Tackling a fixer upper can take a copious amount of time and mental strength. Burning out during the renovation process can become tragic very quickly. If you don’t think you have the time on hand or even the patience to handle a possible multi-month project, then perhaps somewhere that is ready as-is is a better option for you.
With the time and money aspects of a fixer upper aside, a characteristic that isn’t as thought of is the location. Sure, you can turn a 100k house in to a million-dollar house but if the location is undesirable then you might be stuck with the house. A place near modern shops and good restaurants with upkept neighboring houses will always do better than a place near the train tracks with a high crime rate. So, when house hunting, location is a crucial detail to remember. If you purchase in an up-and-coming area, then the value of the property will rise just from what is around it! With the influence of location and your renovations combined, it could result in a greater profit than you imagined if you go to resell.
Like all things fixer upper homes come with their laundry list of pros and cons. They undoubtedly can be a terrific investment and a perfect opportunity to unleash your creativity but the responsibly and financing required will cause for a tough fight. Most importantly be realistic with yourself as a fixer upper is a major project that requires a great deal of time and discipline.
Take an organized approach to help simplify the process to purchase a Fixer Upper house, use the checklist at this location: Click to get the Home Buyers Checklist