Many individuals set out to purchase a fixer upper. The idea behind it is that the bad qualities of the home will lower the price of it. The buyer can then invest the savings in transforming the house into their dream home. But there are different levels of fixer uppers. Its important to know when you should consider a house and when you should run from it.
You should take your time when looking into all of the repairs that are needed. Otherwise a great bargain may instead become a money pit.
House Hunting
If you are after a fixer upper, you can find them, in most cases, the same way that you would other homes. Just ask your real estate agent to help you, since they have access to all homes on the market. Remember, what the property looks like on paper is not necessarily what it will be like in reality.
Reality Strikes
Don't make the mistake of thinking that a low end price is one that necessarily means a great deal. You need to factor in what is wrong with the house. You should have a home inspector help you go through the home to find out what the real problems are, as well as how much it will cost to repair them. Get a professional appraisal of the home as well.
Don't rely on what the seller is telling you. Or let the seller pressure you. Don't agree to purchase until you are sure of the full scope of repairs needed. A pushy seller can be a sign of trouble! You need to allow time to consider how much work, time and money it will take before committing to a house. Take the time to really crunch the numbers and see how much you will actually be investing.
The Area
Like any home that you purchase, you should take into consideration the area in which the home is located. This is important especially when it comes to other homes in the area that have been renovated. In some areas, home values can be depreciating.
Only after you have considered everything that this fixer upper will need from you can you make a decision about whether it is a good buy or not.
Finally, if you plan to use a mortgage to pay for it, you may need to have the bank sign off on the fact that it is a fixer upper.
