Buying a fixer upper home can be a fulfilling, profitable experience. Or it can be a nightmare full of unexpected expenses and unforeseen disasters. Or it can be both. There are secrets to doing it and doing it well. I offer this bit of advice to the average Joe looking to buy a fixer upper. Get an inspection. Heck, even get a *few* inspections. Know what you are buying – know what needs to be done and how much it will cost so that you know what you are getting into. Hubby and I didn’t do that with our home – at least as far as inspections go. But we did expect to redo everything. While it worked for us and we knew what we were buying at the time, not everyone is willing to go to the extremes we did. We bought our home “as-is” – septic at end of life, a/c at end of life, well at end of life and a host of other things. We replaced everything. And I mean everything. We didn’t just go down to the studs. We replaced the studs. New exterior walls. New electrical. New plumbing. Everything. If you know what you’re getting into – go for it. Otherwise, stick with the a home requiring the basics when you are looking at buying a fixer-upper.
There are many advantages to buying a fixer-upper like
- potential profit
- lower sale price
- no one else wants it – less competition
Like I said before, hubby and I didn’t buy the average ideal fixer-upper. The ideal fixer is one that doesn’t need a long list of huge repairs. One that everybody wants once it’s fixed up but not many can see past the imperfections until then. It’s hard and it was hard for us to see past the green and orange swirl shag carpeting, the faux wood paneling throughout, the not just dated but more like disgusting kitchen and bathroom. What we saw though was a house that when completed would be a 4 bedroom 2 bathroom home in a growing and changing neighborhood. We saw a family home with a big yard. We saw the big things you need to see when buying a fixer, like
- Location – a growing or already desirable neighborhood is great.
- Layout – having the bones of a home someone will want to buy – number of bedrooms, bathrooms and size of kitchen are huge things that potential buyers will be looking for when you go to sell.
And here is where I emphasize the most important point of buying a fixer upper. Everyone’s skill level is different when it comes to repairs. Do not underestimate the repairs that need to be done and don’t overestimate your abilities to do those repairs. It will cost you big time before it’s over. My hubby has been able to do every last detail of the work we’ve chosen to do on this house. And it’s saved us tens of thousands of dollars as a result. If he’d gotten over his head on even one project it would’ve been a disaster.
“Easy” home fixes are
- drywall repair/painting/removing wallpaper
- refinishing floors – we’ve done this in all 3 of our homes and it’s a huge bang for your buck in resale value.
- installing new kitchen cabinets or painting/refacing current cabinets
- replacing light fixtures, doors, trim, baseboards
- outdoor renovations like exterior paint, adding landscaping and a deck
Not so easy fixes are
- replacing electrical and plumbing or sewer – very labor intensive and since they aren’t visible to potential buyers they don’t hold as much value – although nice to not have to worry about, most buyers want to see visually appealing renovations like a kitchen or bath upgrade
- installing all new windows
- replacing HVAC
Going into a fixer upper requires knowing your limits. Can you live with eating takeout for however long it takes to redo that kitchen? Can you stand to share one bathroom between 4 people while the other is under remodel? Do you mind having your bed in the living room while the bedrooms are being gutted? Really, this is easier said than done. I think most people, if anything like me, don’t know their limits for such things until in the midst of them. And really, by then it’s too late 🙂
Like I said, what we’ve done in our remodel has been valuable and will hopefully turn out to be quite profitable when we decide to sell someday. Most of that is based on the fact that hubby has been able to do the work himself. I don’t recommend it and anyone I know looking to do work I would advise accordingly. I’m not an expert on housing. I’m not even close to being an expert on fixer-uppers. I can just say what has worked for us and how.
Designing and renovating a home and bringing it to life in your own unique way is very rewarding. It’s fulfilling to see the fruits of your hard work and labor. It’s also stressful, time consuming and energy draining. What we had to decide as a family was what are our priorities, what are our goals, and how do we best meet those things. And for us, this fixer-upper and what we’ve put into it was our answer. Not an answer everyone else would come up with but one that has worked well for us.
This post is part of a writing project headed up by Rocket Finance exploring different aspects of the sub-prime crisis, lending practices, and foreclosures, and is my own musings on taking on a risky fixer-upper. Visit Rocket Finance on Friday for Home Finance: all you need to know about home ownership, a carnival of entries in this project.
Other posts in this project so far can be found at
My Thoughts on this Whole Mortgage Crisis and Why I don’t Feel That Bad at My Two Dollars
The We Can Afford the Payments Mentality at I’ve Paid For This Twice Already
Should I Invest in the Stock Market or Real Estate? at Millionaire Money Habits
What is Debt To Income Ratio and Why Does it Matter? at Moolanonmy
Why We Have an Adjustable Rate Mortgage at My Dollar Plan
Ana questions the process of paying off credit cards with a HELOC at Debt-Free Revolution
Plonkee Money shares her thoughts with American Sub-prime Crisis Should We Care
Mrs Micah shares her thoughts on Why Renting is Right For Us Right Now
SingleGuyMoney shares this excellent post about The Real Cost of Home Ownership. Something everyone should read before buying!
And check out this FABULOUS post from Being Frugal where she shares 75 Frugal Hacks for Your Home
16 comments
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January 30, 2008 at 12:15 pm
Mrs. Micah
I honestly don’t think I’m the fixer-upper type. If Micah was, I think I could handle living with various repairs going on. We periodically had things done to the house as kids and we survived.
Your point about the inspections is so important. My grandmother considered buying a place but she would have had to get rid of the carpenter ants and replace the damaged wood. She knew that was more fixing-up than she was prepared for. On the other hand, she had people completely repaint her new house’s walls to cover some hideousness. That was within her budget and tolerance.
January 31, 2008 at 5:08 am
US Subprime Crisis | Quest For Four Pillars
[…] Remodeling This Life wrote a post about how she and her husband bought a house and totally gutted it. This post brought bad some unpleasant memories for me because of our own fixer-upper experience. She has a fair bit of advice and warnings for anyone who wants to buy a fixer upper. […]
January 31, 2008 at 10:36 am
plonkee @ the religious atheist
My house is a fixer-upper (some updating required). Fortunately it’s mostly cosmetic, and of course it requires the general repairs that a 100 year old house would in any case.
It’s going to take me a long time to save up all the money needed to fix it all, but doing the things that are more important to me first is good. I’m not planning on selling it for a while, especially as the housing market in the UK is “softening”.
January 31, 2008 at 2:09 pm
Uberjoy
Hi thanks for stopping by my Uberjoy blog.
Yes, I love toile. It seems the Nester thinks toile and checks are a good mix!
I admire your renovating, we have several rental houses and oh the things that can go wrong in older houses in general!
I will stop by again!
Meredith
January 31, 2008 at 3:11 pm
Carmen SanDagos
Hi,
That is a good idea if location is important, otherwise I believe its much better to buy bare land and build from the bottom up, if the fixer upper is extreme.
My fixer upper was a nightmare, and the trades found it very difficult. The worst jobs were hauling the Junk away, and clearing the building from pests.
I would never go that route again
Carmen
http://homeincomeportal.com/mystory
February 1, 2008 at 9:11 am
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February 1, 2008 at 11:21 am
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February 1, 2008 at 11:46 am
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February 2, 2008 at 7:13 am
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[…] Remodeling This Life wrote a post about how she and her husband bought a house and totally gutted it. This post brought bad some unpleasant memories for me because of our own fixer-upper experience. She has a fair bit of advice and warnings for anyone who wants to buy a fixer upper. […]
February 2, 2008 at 11:04 am
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February 3, 2008 at 1:30 pm
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[…] So You Want to Buy a Fixer Upper @ Remodeling This Life Buying a fixer upper home can be a fulfilling, profitable experience. Or it can be a nightmare full of unexpected expenses and unforeseen disasters. Or it can be both. […]
March 7, 2008 at 9:49 am
Great advice for buying a home! | rocket finance
[…] Many people look at a house purchase as an investment – it can be and it is. Mike from Two Wise Acres gives a great deal of wise advice if you are considering a house as an investment. If you are debating whether or not to invest in a house or increase investment in the stock market, you should stop by Millionaire Money Habits. Sweat equity is a great way to increase return on your housing investment and we have made a great deal of improvements on our home, but it is not always easy or cheap. Remodeling this Life asks So you want to buy a fixer-upper?. […]
May 28, 2013 at 10:54 pm
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