When buying a fixer-upper it can be very easy to bite off more than you can chew. When an agent uses the term “fixer-upper” it could mean anything from a total disaster to a nice place that needs some cosmetic work. Know what you’re getting yourself into before finalizing the deal. Learn which Questions to Ask When Buying a Fixer-Upper below.
Questions for your agent
What are the neighborhood stats?Neighborhood dynamics become mission-critical when buying a fixer-upper. Will the remodel dollars needed to make this home livable work well with the neighborhood? Ask your agent for her analysis (and the stats to back it up). If you invest $30K in improvements but update the home beyond the neighborhood’s value, your ability to recoup your investment is greatly diminished.
Is the home located in a historic district? Buying and fixing up a charming Victorian home sounds dreamy: original crown molding, wainscoting, and lovely stained-glass windows. But buyer beware: Ifthe property is historic or located in a historic neighborhood, the remodeling and finishes may have to be completed to an association or city standard. In many cases, this means getting approval for improvements and updates and often comes with a hefty price tag.
Questions for your inspector
What is the state of the home’s major systems? Given that the term “fixer-upper” is often synonymous with “a ton of work and cash,” it’s important to choose your inspector wisely and to listen carefully. Cosmetic work is expected, but what about the foundation, electrical, and plumbing systems? Better yet, how is the roof — can it hold in heat and keep out rain? These items can run easily into the tens of thousands — and could turn a quick fix into a money pit.
What are the huge hidden expenses? Ask your inspector to dig deep into the home’s details. For example, does the unfinished basement have an adequate ceiling height and is there any evidence of flooding? If the basement needs a new subfloor and vapor barrier, do you need a permit to complete the work and must you hire a licensed and bonded professional? If an issue is uncovered, you may need to call in an inspector who specializes in that area. Your inspectors are the first line of defense against a poor investment. Use reputable professionals with relevant experience; their advice can be worth their weight in gold.
Questions for your contractor
What is the total investment? Once you formulate a plan based on the inspector’s report, sit with your contractor and discuss your options. As with any project, it doesn’t have to be an all-or-nothing approach. There are plenty of middle-road solutions that can satisfy your bottom line as well as a time commitment that’s comfortable. With that said, budgets and timelines may run over, so work with a reputable contractor to minimize the headache of living in a construction zone.
Questions to ask yourself
How is the overall layout of the home? With considerable cost and headache, it’s possible to change the structural layout of a home. However, I would counsel you to closely consider the existing layout of the home. Are there many small rooms with random nooks, whereas you’re more of a great-room kind of buyer? What about the number of existing bedrooms and bathrooms? If you require a four-bed, two-bath home and it’s currently a two-bed, one-bath, be certain this home will truly meet your needs.
Do I have the time, energy, and patience for this project? This is where you dig deep in your soul and be honest with yourself: Are you prepared to have a DIY project every weekend for the foreseeable future? Or on the flip side, are you prepared to drop a boatload of cash, paying professionals to make your fixer-upper into the dream home you’ve always wanted? Get real with your expectations and available resources.
If your in the market for buying a new home or even a fixer-upper, Stonebridge Mortgage Group can help you with your Mortgage Financing needs. Visit Stonebridge Mortgage Group in Gresham, Oregon or call at: 503.661.5580 to get started on your Mortgage Financing Today.
SRC: Learn more about which questions to as when Buying a Fixer-Upper at: time.com/money/4053041/questions-buying-fixer-upper-house/?xid=homepage