Buying Fixer Upper Homes
Rooted in the heart of Americans is the pride of homeownership. There is no better feeling to some than to take their newly purchased home and turn it into their own custom heaven. This is why “Fixer-Uppers” are so popular among many buyers. “Fixer-Uppers” range form minor cosmetic repairs to major whole in the wall leaky pipe dumps. Amidst the ill look of the home it often strikes a great interest to the investor minded homebuyer. A home with only cosmetic needs could very well yield a great return on the dollar.
Here are a few things to consider when looking to purchase a “Fixer-Upper”
Where can you find a “Fixer-Upper”?
“Fixer-Uppers” can be found in the wealthiest of neighborhoods as well as the older parts of town. With the great amount of diversity in this city it is not uncommon to find a home that has been left in shambles by tenants or homeowners who were irresponsible and careless.
Build your team
Who is going to help you locate this “Fixer-Upper”? Do you know a good real estate agent? What about your financing? Who is a lender that knows of loan programs specifically for “Fixer-Uppers”? Are you going to do the repairs or is it a project that requires a contractor? Building a strong team before you get started will not only make it a much smoother process but will save you time and money.
The benefits of a home inspector
We recommend that all of our buyer clients get a home inspection. This is a great way to find out what you’re really getting into. These general inspections, from top to bottom, will help the inspector locate and obvious defects or concerns. It is always a good idea to be at these home inspections. This way you can see for yourself what the problem is and possibly get some good recommendations for a remedy.
Use a qualified lender
With hundreds of loan programs available make sure your lender gets the right loan for you. There are specific loans for “Fixer-Uppers” check to see if your lender is familiar with them.
If you use a general contractor make sure they are legitimate
Make sure general contractors are licensed, insured, financially stable, and not facing numerous consumer complaints. Ask for references and verification on all of there credentials. There could be liability issues that become your responsibility if you do not check them out fully. Call around and check out some of their past work. If they are good they should have no problem giving you this information.
Have a good idea of what type of “Fixer-Upper” your looking for
Are you looking for a large project or are you looking for something a little more manageable on a personal level?
How to choose the right house
In any neighborhood, a good rule of thumb is, choose the house in the worst shape. Whether it is in the most upscale neighborhood or the most trodden down, this rule usually rings true.
How should this home compare
This is where a great real estate agent comes in handy. A real estate agent has great resources for finding the common price for homes selling in that particular area. Another good idea is to look around the area to see if other homes have been refurbished.
What experts say
‘Buy when the market has hit bottom”. This ensures that you will not be overcharged and also that you will get a great price. This will definitely help in offsetting your repair cost.
Know your cost
Calculate everything. Figure in all of your cost for mortgage payments, repair, material, labor, etc… Know what your final outcome will be. Always estimate high. You may end up with a nice little gift at the end.
Buyer/Seller Negotiations
There are a few options available to you as the buyer pertaining to the defects in the inspection report. You can either cancel the deal because it will be to much work and cost or you can negotiate with the seller to have them pay for the repair cost or lower the price of the home. Work with you closely agent during the negotiation process.
If you put the time and effort into your research you can definitely find some great “Fixer-Uppers”. If your team is built of professional trustworthy honest individuals and you work closely with them you can have great experiences with your “Fixer-Uppers”.
NOTE: Information on this site is not guaranteed to be accurate. Some content is compiled from 3rd party sources. If you are aware of incorrect or outdated information, feel free to contact us.