Want to buyer a fixer upper? Make it a “cosmetic fixer” ~ Or get ready to bleed….
Fixer uppers are a good thing overall – but it’s got to be a cosmetic-fixer-upper to make some money on it. You really only want to fix things like – removing wall paper, new flooring, some new fixtures, etc. If you are out there removing walls, adding square footage – a big no-no – and redoing plumbing and electrical panels, then you may be spending too much to recoup your money on a fixer upper.
As per an article in Construction Management Degrees Blog entitled “Buying to Renovate? Read this First” they say that homes that need lots of renovations typically require subsequent maintenance, permits that are hard to attain, expensive structural changes, and plain old difficulty at every turn.
When showing property to clients, one should be careful to point out homes that just need paint and carpet as a ‘good buy’ vs. homes that require structural changes really add up over time and take a toll on your time. Major renovations vs. cosmetic changes include – brand new kitchens vs. new counters and appliances; gutted bathrooms vs. new fixtures and lighting; wall removal vs. adding new windows. Sometimes it’s easier to build a whole new house instead of tackling difficult structural renovations. Taking out part of a wall to open up a kitchen is no big deal, but moving plumbing is expensive so watch out for this one too. Pandora’s Box is what you need to be wary of – you just never know what you’re going to find when you start opening up walls. Getting a home inspection when you buy your home is of paramoun importance. This helps you know whether it is worth it or not to make some changes that will add up vs. buying white elephant.
Sometimes it’s less expensive to buy a home in that “next price range.” Spending $50K more upfront than what you think your budget might allow may actually be a savings. Get the house that already has the new kitchen and just needs some bathroom updating vs the house that needs everything. It’s gonna cost you $50K just to remodel the kitchen and when you open it up you might find you need to update to copper plumbing or need a new roof or who knows what. Make sure you understand what it costs to renovate these days.
