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A lot of good has come from our decision to buy an as-is fixer upper and do a complete home remodel. I won’t deny that. It has turned into one of the best things for our life in so many ways. We’ve learned to live simply, we’ve learned to appreciate having a home more, and we’ve taught our children some valuable lessons along the way about hard work, determination and the value of having do-it-yourself skills.

Here is a list of some mistakes we were either fortunate enough to avoid or unfortunate enough to have to learnas we went along.

1. Supersizing – to be honest, we have had and still have had thoughts of adding on to our home. It’s about 1800 square feet and we’ve toyed with the idea of adding a 2nd story for another 600 sf. The truth is though that rarely does an addition to a home recoup it’s cost in the short term. For us to decide to add on, we’d also be deciding to stay put for the long haul in this home. We’re not doing that. And when it comes time to sell we want the home to fit with the neighborhood and original style and we want to be able to recoup our remodeling costs.

2. Trying to make a home something it isn’t – in our case, we bought a 1960 ranch. It would’ve been silly to try to make it into a massive victorian. We chose to go spanish style cottage with ours. There are a lot of choices so make sure the style your home is when you buy it lends itself to what you want it to be.

3. Changing the function of rooms – for us, one of the biggest money and time savers was keeping the kitchen the kitchen and the bathrooms the bathrooms.

4. Do It Yourself – we haven’t (knock on wood) had any major mishaps with hubby taking on our remodel himself. He’s managed each project along the way just fine but it can be a huge money and time drain if you don’t know what you’re doing and have to call someone in to tear out your tile job and do it properly.

5. Costly renovations for little return – If you’re remodeling for yourself to make home yours for the rest of your days, it is one thing. If you’re remodeling and will be looking to sell someday, it’s an absolute necessity to know what people will be looking for in a home. Know what the return on a gourmet kitchen is vs. a midrange kitchen remodel. The biggest returns in remodeling come from replacing exterior siding, new windows, and kitchen and bath upgrades.

6. Underbudgeting – This one, I don’t know many people who stay within budget on home building or remodeling but it’s important to have some idea of what you’re looking at and a back up plan better than sinking into debt. Not planning for costs properly can either result in a delayed project, bigger debt, or work that lacks quality to cut costs.

7. Assuming you can live in your remodel while work is being done – you CAN live in your remodel, but if you choose to go that route, know what you’re getting into. Doing dishes in the bathtub while the kitchen is gutted, and eating out for most meals. Be prepared.

8. Not Planning for the Unexpected – You have no idea when you tear open a wall if you’ll find pest problems or moisture issues requiring structural repair. You may discover wiring that needs to be replaced, pipes that need to be rerouted or moisture problems that have rotted away joists or sill plates. Pad your budget and allow yourself a bit of flexibility in your work schedule to accommodate these not-so-nice surprises. We planned for all of the above going into our as-is remodel and we were greeted with all of the above!

9. Going Trendy – it’s always safer to go with classic design when remodeling because it will last and you won’t feel like you have to start over with remodeling in 3 years when what you chose is out of style. Classic colors and styles will appeal to you longer and to prospective home buyers when it’s time to sell.

10. Not doing your homework on your contractor – if you’re using a contractor or contractors for all or part of your project, get recommendations. Go see some of the work they’ve done. Ask previous clients how the contractor handled problems and if the jobs were done in a timely manner. Remodeling is stressful and can be expensive. Don’t add to that stress by not knowing what you are in for with an uncooperative or slow contractor. Get a contract once you’ve chosen your contractor with cost, scope of work and start and end dates!

11. No permit – find out of your projects require a permit and get one if they do. If you have a contractor doing your job, put them in charge of getting the permits to save you time and money.

12. Check insurance – Before your start your project, check your homeowners policy limits. Since policies are often purchased based on existing house value, you may need to make changes to your policy. Also make sure anyone working on your property is carrying Workmen’s Comp Insurance.

13. Unsafe conditions – use tools properly, wear safety goggles, keep your work area relatively clean. Nothing will delay your project longer than a stint in the emergency room for not taking proper precautions while working.

14. Skimping on Materials – know where you should be paying more for quality. From drywall to flooring, to countertops and fixtures. Decide what you want that fits the budget. Put in flooring that will last, not just the cheapest one you can find. If you want high end appliances in your kitchen, you may have to adjust your countertop budget and install laminate instead of solid surface. Make those decisions ahead of time so you can expect what your end result will be.

15. Not having a plan – this was, admittedly, us. We had a vague plan at best when hubby started tearing out walls and floors. Our plan was “remove it and replace it”. That’s about it. It worked out okay in the end but it would’ve saved a bit more of our sanity and patience and time if we’d laid out a step by step plan ahead of time to have an idea of what would happen when. And it could’ve been disastrous if we’d stumbled upon bigger issues during tearouts.

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