Skip to main content

Are You Thinking About Buying a Fixer-Upper?


 

If you’re thinking of buying your first home, it’s an exciting time. You’ve probably scoured real estate sites looking at available properties. If desirable homes are out of your budget, you may consider buying a fixer-upper. Although these homes will need work, their purchase prices are usually significantly lower than homes in good repair.



 

Are You Looking to Buy a Fixer-Upper?


One of the first steps in buying a home should be preapproval for a mortgage. That way, you’ll know how much a lender will let you borrow to purchase it. Keep in mind, though, that you’ll also have to pay for renovations if you buy a fixer-upper.

 

Some financial institutions offer rehabilitation mortgages that provide extra money for these repairs. Be prepared for additional inspections and appraisals if you buy a fixer-upper.

 

A home inspection is vital if you’re looking at a distressed home. This tells you everything the inspector finds that needs to be repaired, although it’s common for hidden problems to arise during renovations.

 

Before you sign a contract, you’ll need to list the repairs you will make and get quotes from contractors or other professionals to determine how much they will cost. Be sure that the total rehab budget is reasonable. If the cost of the home plus necessary repairs equals more than similar houses appraise for in the area, you might want to pass on that property.

Like with any home purchase, you’ll want your fixer-upper to:

• Be in a good location
• Have enough space
• Have the correct number of bedrooms and bathrooms
• Be convenient to work, schools, and other frequent destinations

 

Which Renovations Should Be First?

Financial advisors recommend that you pay for renovations in cash as you go, if possible. For buyers who get renovation mortgages, you’ll have a certain amount of money set aside in escrow for your repairs. Regardless, there are some projects you should prioritize.

 

Structural issues are a definite priority, but major home systems are usually next. You’ll need a sound roof and an efficient HVAC system. Contact Amp One Heating & Cooling to inspect your home’s HVAC system and make necessary upgrades.

 

When deciding which project to tackle next, it’s good to prioritize those that improve your home’s value. You can research features that many buyers look for:

• Updated kitchen and baths
• Outdoor living spaces
• Energy efficiency
• Hardwood flooring

 

Can You DIY?

You may be handy with a paintbrush and a screwdriver, but there are some things you’ll probably need to hire a professional to do:

• Electrical work
• Roofing
• HVAC
• Plumber
• Structural repairs

 

While it can save money to make repairs yourself, some require licensed professionals so the home will pass inspections. In addition, if you’re not capable of producing professional results, it’s better for a home’s resale value to hire someone else.

 

Will You Live in It?

People buy fixer-uppers for several reasons. Some enjoy reshaping the home they’ll live in, some plan to flip it, and others plan to turn it into a vacation or residential rental property. The home’s location, your family’s needs, and the overall housing market are factors to consider.

 

If you decide to keep the house but plan to rent it out, you’ll be a business owner. Be sure to register that business with your local and state governments and get an EIN (a tax identification number) so you can take advantage of tax deductions.

 

Are You Ready?

Buying a fixer-upper can have many benefits. Select the property carefully, choose and make repairs in a smart sequence, and hire professionals when needed.

Labels:

Comments

Post a Comment

Popular posts from this blog

Helena Mini-Split Heat Pumps What You Need To Know

  Mini-Split Heat Pumps   A Reliable Heating Source     When the cold months hit, it’s better to be prepared than to be caught off guard. Specifically, the northern states can bear the brunt of the cold weather, especially during January and February. How can you stay warm in these cold months? Well, one of the best options that you can consider is a mini-split heat pump for heating Helena, MT . Although your traditional AC units or HVAC systems are also good investments, mini-split heat pumps could work better if you don’t have ductwork in your home. Let’s go over some of the benefits you can get from using a mini-split system.   What is a Mini-Split Heat Pump?     The heat pump design works by drawing heat energy from the outdoors and transferring it inside your home. The entire mini-split system is comprised of both an indoor and outdoor unit. The indoor unit is connected directly where you want to cool or heat a room in your...
2 comments
Read more

Time for Spring Cleaning and Repairs!

​ Time for Spring Cleaning and Repairs! When it comes to making home improvements and upgrades, there's no better season than spring. Not only does a good spring cleaning allow you to air out your home from top to bottom, but it also provides an opportunity to check for any winter house damage and start making plans for repairs before the summer months arrive.  Amp One Heating and Cooling  can be an excellent resource when it comes to maintaining your HVAC systems. DIY Versus Hiring Out When making a determination about whether home improvement projects can be handled on your own, or if you need a professional hand, do an honest assessment about your capabilities. According to Consumers Credit Union, if you're a super handy person who is comfortable tackling large-scale projects, there are a number of things you can certainly do yourself and  save money . However, if a task calls for specialized knowledge or equipment, or if a project has the potential to be dangerous - t...
2 comments
Read more

Air Conditioning Preventative Maintenance

  HVAC PM's If you’re a homeowner, chances are, you have a lot of things on your mind and even some on the back burner. The last thing you want to worry about is having an issue with your air conditioning unit. In order to prevent outages and other expensive repairs down the road, employing prevention methods on your home front could do you — and your air conditioner — some good. Here are some preventative methods to maintain your air conditioner and extend its lifespan: 1 ) Clean the filters on a regular basis You want to make sure that your filters aren’t clogged with dirt, dust, and other debris. Get in the habit of checking your air conditioner’s filters every month or every other month to make sure a lot of debris isn’t building up. If it is, clean or replace the filter. You want efficient filters because a dirty one can increase your home’s air consumption by 5 percent to 15 percent. That means you’re shelling out more of your hard-earned money for utilities. Plu...
17 comments
Read more