What to Look Out for When Buying a Fixer-Upper
Fixer-uppers can offer some great opportunities to people starting out in the real estate game - and to savvy investors looking to increase their property portfolio. But fixer-uppers also come with their fair share of potential pitfalls. Before signing on the dotted line, be sure to consider all the points listed below.
The Foundation
This is the most important factor when looking at a fixer-upper: the integrity of the foundation. Structural damage to the foundation is hugely costly and time-consuming to fix, so it’s imperative that you get it checked out by a professional. Use a service such as Housefax or HomeGauge to ensure you’re getting the full picture about the home’s existing condition and potential issues.
Roof
The condition of a home’s roof is a major conern when looking at a fixer-upper. A small leak now can quickly become a lot more damage down the line. Investigate fully to ensure the roof will last for the expected years and get any necessary repairs fixed, ASAP.
Plumbing and Electric
Malfunctioning or inadequate wiring and plumbing can be incredibly dangerous and even lead to a hazardous situation in the home. Make sure to arrange for a full inspection to ensure all wiring and plumbing is up-to-date.
Inspections
It’s important to get a full home inspection when purchasing a fixer-upper in order to assess the value of the property. This will give you a comprehensive list of the property’s deficiencies and structural problems. Additionally, you’ll be able to get an estimate of the total cost for renovations and to decide whether or not the property is indeed a good investment.
Buying Process
Buying a fixer-upper can be a long, drawn-out process. You may face frustration, delays, and unexpected problems along the way. Before you go ahead, make sure you’re prepared to go the extra mile and take the right steps.
Research
Do your due diligence and research the market, the area, and the property in detail. Know what you’re getting yourself into and be certain that the fixer-upper is going to be a sound investment.
Financing
Know what type of financing you’ll need to get the fixer-upper up and running. Many lenders offer special programs and rates for fixer-uppers, so take the time to explore your options in order to make sure you get the best deal.
Location, Location, Location
Location is a huge factor when buying a fixer-upper. Make sure to ask questions about the local market to ensure you’re getting a good value for the money. Visit the area and get to know everything there is to know about the neighborhood - from amenities to commute times - so you can make an informed decision about the property.
Contractors and Repairs
Depending on the scope of the repairs needed, you may need to hire laborers or professional contractors to get the job done. Investigate contractors in your area to make sure you’re getting skilled professionals and reputable firms.
Budget
Before you commit to a property, be sure to determine an exact budget for renovations, repairs, and maintenance. Make sure you have a clear plan and understand the full extent of the costs you’ll be taking on.
Final Thoughts
Fixer-uppers can be a great investment opportunity - and loads of fun - if you know what you’re getting into and do your research and due diligence. Be sure to consider all the points listed above and you’ll be well on your way to a successful flip.