When you’re buying a house there are lots of decisions to be made. One of those decisions is whether or not you’re willing to purchase a fixer-upper. You’re sure to find plenty of examples glamorizing the fixer-upper experience, and it can be tempting to want in on the action. You’ve likely heard tons of stories about incredible deals people got because their home needed a little work. Not to mention all those TV shows where houses no one could even lives in gets turned into something worthy of a magazine spread and sold for top dollar. Fixer-uppers can definitely be an amazing find, but before you dive in head first, weigh the pros and cons to make the right decision for you.
Pros
- Fixer-uppers are usually discounted. Fixer-uppers generally have lower asking prices and do sell for less than move-in ready homes. There is often less competition too.
- You can remodel the way you want. You don’t have to hope you find what you want. You have more control over how the home looks, feels, and functions when you’re the one in charge of the remodel. You can spend your money on what’s important to you.
- You may be able to afford a larger home or a different neighborhood. Since fixer-uppers tend to sell for less even in the most desirable neighborhoods, your purchasing dollar can go further.
- Ensuring the repairs are done right. You’ll have control over the repair process so you don’t have to worry about the quality of materials or workmanship. If you think the contractor is cutting corners, you can hire someone else.
- Remodeling boosts your property value immediately. This can be a plus if you’re planning on living there only short term or looking at buying a house for an investment property.
Cons
- Your home isn’t move-in ready. You’ll have to wait until construction is finished to enjoy your new home or rent it out. That can impact your budget.
- It’s a lot of work. Whether you plan to do it yourself or hire contractors, there is a lot of effort involved. Not everyone is willing to take it on. Being honest with yourself is the best strategy here.
- Remodels can easily go over budget. It’s not unusual for any kind of remodel to go over budget. There can be unexpected surprises, additional costs, or design changes. It’s a good idea to leave room in the budget for additional costs.
- There’s a risk of ending up with a bigger project than you planned. In some cases, it’s just not possible to know the full extent of repairs until the job is in progress. That can negatively affect your budget and timeline for repairs.
- You may overestimate your DIY skills. Often when someone is buying a house, they plan on doing some projects themselves. Especially for first-time buyers, it can be easy to underestimate how much work a project is or how much time you’ll have to do it. Additionally, some repairs may require hiring a contractor to comply with local ordinances.
- It can be harder to get financing. The current condition of the home and types of repairs needed may mean it’s more difficult to get financing or limit your financing options.
When you’re buying a house, you need to look at the pros and cons to make an informed decision. And that strategy is even more important if you’re planning on purchasing a fixer-upper. But doing your homework, getting estimates and budgeting appropriately may make that decision the right one for you.
