There can be something so whimsical about buying a fixer-upper house. How much fun would it be to purchase a charming older home at a discount and renovate it into your dream home? Sure, it’ll require some hard work and elbow grease, but at the end of the day, the house will be customized to fit your needs and wants—and you’ll save a ton of money. Right?
When building or buying a home, it’s essential to have a realistic timeline and a budget that allows for every cost involved in your renovation.
Here are some need-to-know tips on how to make sure buying a fixer-upper home doesn’t break your budget or your sanity.
Hire a professional.
When investing in fixer-upper houses, it’s important to know exactly what you’re getting yourself into. An essential step in the fixer-upper home buying process is hiring a quality inspector to assess the property. They can tell you exactly how much renovation you will need. Then, you can get estimates and have your real estate agent bring this to the seller to help negotiate the price.
If most of the needed repairs are cosmetic, your fixer-upper renovation may be less expensive and a quicker process. But if your budget doesn’t allow for repairs to structural damage to the home, knocking down walls, replacing electrical systems (you get the idea), then buying the house may not be worth it. Here are some potential issues to look out for:
- Cracks in the foundation
- Signs of water damage in the basement
- Pest infestation
- Strange odors (mustiness could indicate mold, or a sewage smell could mean trouble with the septic tank)
- Poorly maintained roof
- Old, outdated plumbing and electrical systems
Usually, an inspector will find these things during the walk-through, but if you see many of these red flags during the viewing, you may be better off declining to make an offer. Preparing a home inspection checklist can help save you time and heartbreak.
Don’t overestimate your skills.
Most of us have been guilty of this. We watch hours of HGTV, successfully do one DIY project, and, suddenly, we think we can tackle any home repair with the right tools and how-to video on YouTube. But some projects require professional experience and a hefty budget to purchase the correct equipment.
What starts as a simple afternoon project could quickly turn into a whole weekend, with dozens of trips to your hardware store to fix issues. Before you know it, you’ve spent much more than you expected and still have to call in a professional to finish the job.
When drawing up estimates on fixing up a house, make sure you allow for the worst-case scenario situations and factor in how much it will cost if you have to hire a contractor on all projects. Hiring a professional may save you money down the road because you know the project will be done right.
Also, don’t forget about the cost of permits when totaling your upfront costs for buying a house. Depending on what you need, they can add up. Some home warranty plans—like our ShieldPlatinum™ plan—offer coverage for permits and code violations costs.
Be pessimistic.
No one likes a Debbie Downer. But in the case of buying a fixer upper, you should plan for everything to fall apart so that you’re prepared to pay for any issue uncovered during renovation.
When it comes to a time frame, it may be helpful to double your initial estimate. Several factors can affect home renovation timelines, and many of them are hard to predict. Some fixer-upper home renovation delays can be caused by:
- weather
- construction material delays
- lack of funds
- contractor availability
At the beginning of the process, map out everything you want completed. Some delays are inevitable, but if you suddenly change your mind on what you want while the renovation is underway, it’s going to cost you more time and money.
