Tips on How to Safely Buy a Fixer-Upper

16 November 2020

Owning a house or becoming a landlord can significantly improve your financial security. For some, the journey towards homeownership begins with a gift or inheritance. Others buy properties while many others buy land to build new homes from the ground up. If you opt to buy a property, you are confronted with a few viable options. You can decide to buy new homes or go for a fixer-upper.

Image by Nolan Issac on Unsplash

However, finding the right fixer-upper with an unbeatable deal can be challenging. The house can siphon your hard-earned money with very little to no financial gain. The following tips will help you to safely buy a fixer-upper at unbeatable value.

Go for a firm foundation and layout

Fixer-uppers with severely damaged foundations and layouts can significantly increase your renovation costs. If you plan on reselling the property, a considerable chunk of your profits will go into renovations. While you should go for houses with solid foundations and appealing layouts, you may want to consider underpinning houses to protect your investment. Additionally, although fixer-upper projects involve a lot of reconfiguring and remodelling, ensure that your financial gain is worth the wait and effort.

Carefully choose the location and landscape

Reconstructing a fixer-upper is a labour of love. You have to picture the house when completed before signing between the dotted lines. One of the easiest ways to improve your financial gain at the end of a tedious reconstruction process is choosing the right location and landscape. A dilapidated house with a great view and breathtaking landscape will attract buyers or renters. And you stand to make a good profit. A great curb appeal is a great selling point in the property market.

Look at critical fittings

Important fittings, including the plumbing system, the bathroom, sewer lines, and the kitchen, can significantly increase the price of a fixer-upper and the net financial gain. Repairing or upgrading these fittings is relatively expensive. Bring in a professional to inspect these fittings before making any decision on the house.

Rope in the help of professionals

Purchasing a fixer-upper and beginning the reconstruction project without the input of professionals is an exercise in futility. Officials from the local municipality can slap you with a huge fine or even close down the whole project. Work with a certified contractor who is familiar with local laws. Additionally, bring in a home inspector from the municipality to inspect the house for sewer leakages, pests, and overall integrity. These professionals will help you understand the flaws and strengths of the house.

Work with a flexible and realistic budget

When budgeting for a fixer-upper project, avoid working with tight budgets. Accommodate miscellaneous expenses while also taking care not to overshoot your estimates. Have realistic expectations on price and expected return-on-investment.

Owning a home gives you unbeatable satisfaction and a sense of security. While fixer-uppers provide a seemingly easier and cheaper path towards homeownership, always be realistic in your expectations. Look for potential structural problems when buying a house that may eat into your return on investment.

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