If you’ve watched shows such as “Property Brothers” and the like, you know that there’s real potential in buying and renovating a fixer-upper. Instead of paying more for a home that’s already upgraded, you can potentially save some money and create a home exactly to your liking.
But buying a home that’s in serious need of some TLC isn’t exactly clear-cut. There are likely a host of issues with the place that warrant some further investigation. Fixer-uppers that just need some cosmetic adjustments are ideal, but there are plenty of run-down homes that are hiding a lot more serious problems that could wind up sucking you into a money pit.
If you’re considering buying a home that needs a total overhaul, follow this advice first.
Double-Check the Zoning
You’re obviously going to be making changes to the home once it’s officially yours, but the extent of these modifications will be dictated by the zoning in the area.
For example, if the home you’re purchasing is deemed a historic property, you’ll have to get permission from the municipality to make specific renovations.
Or, if you’re planning on putting in an addition to the home, you’ll need to make sure such a change is allowed. Every jurisdiction will place restrictions on what can and cannot be done to a home and the lot it sits on. If your particular jurisdiction states that building structures can only occupy a certain percentage of the lot, that sunroom addition you’ve been dreaming about might not be possible.
Check out your prospective home’s zoning requirements by visiting the municipality’s website, or have your real estate agent find out the nitty gritty details for you.
Consider Your Renovation Budget
The purchase price of the home – and all the associated closing costs that go along with it – is only part of the money you’ll be spending. You’ll also need to figure out how much all the work you plan on doing will cost you, and add that to your budget. And don’t forget to add 10% to the renovation costs to accommodate for any unforeseen issues that you will almost undoubtedly come across with an older home.
The best way to determine the cost of the renovations is to bring in a licensed contractor and architect. They’ll be able to size up the type of work involved, and give you a pretty accurate cost to create the end product you’re looking for. If that figure – combined with the purchase price of the home – is way more than you can comfortably afford, keep looking.
Identify Any Hazards
Many older homes, especially those built in the 1950’s and before, have lead paint and asbestos lurking. If that’s the case, you’ll have to take specific precautions to remove these hazardous materials before any renovations can start. Just about every state in the US requires specific protective actions to deal with lead-based paint and asbestos.
These are jobs that the average person should not tackle on their own. These materials need to be removed by certified professionals who have the training and the tools needed to safely eliminate them from your home.
Not only can this extend the time needed to renovate, it can also significantly hike up the cost of even the smallest renovation.
Check Out the Foundation
You’ve checked out the home from top to bottom, and everything seems kosher. But did you have a look at the foundation?
Are there major cracks, water seepage, slanted floors, or any other issue? Will the foundation require significant repair, or even a total replacement? Major issues with the foundation are super expensive, and can even make it harder for you to obtain financing.
Hire a Home Inspector
Even after you’ve scoped out the place, done your due diligence and decided to tentatively agree to buy the home, you still need to get a licensed home inspector in there to uncover any other issues that you didn’t notice. Your home inspector will look for issues with the home’s structure, plumbing, electricity, roofing, and other elements.
Be sure to be present during the inspection so you can ask questions along the way. While you’ll be given a thorough report after the inspection is done, you’ll be able to get first-hand answers about any potential problems with the home.
The Bottom Line
Fixer-uppers are definitely not for the faint of heart. They’re time-consuming and stressful, and can be a wallet-drainer if you make the wrong purchasing decision. But if you do your homework and take all the precautions possible before buying a run-down property, you could realistically wind up with a fully customized home that you’d never find anywhere else, all within budget.