Looking for a home in today’s market can be daunting. Many prospective homebuyers have started searching for a diamond in the rough: a home that needs work, but when it’s finished will look completely different - in a good way. However, often times, people will buy a home like this not actually knowing how much money, work and time will have to go into the home.
If you are thinking about purchasing a fixer upper, these pros and cons should help you find one that won’t drain your bank account or take years to finish.
- Below market price
- Not much competition among buyers
- Lower taxes, since those are based on the selling price
- Potential for redesign
- Renovations will substantially increase the value of the home
- May require an incredible amount of work
- May be expensive to hire contractors
- Hidden expenses may arise once renovations begin
- May take more money and more time than originally expected
In other words, if you are going to purchase a fixer upper, you need to do your research and have a detailed home inspection.
Look for major issues in the house. If the house has structural damage (foundation and roof) or there are utility issues then you may want to steer clear of the house.
The bottom line is that if you decide to go this route, make sure you have the time, money and patience to renovate your home. When it’s all said and done, this may be your opportunity to live the DIY lifestyle like you see on TV.