A Beginner's Guide To Buying A Home To Renovate
Are you a first homebuyer or investor looking to spend less now to make more in the future? With some quality fixer-upper houses coming on the market, now is as good a time as any to buy a house you can renovate over time.
Fixer-upper properties can be a great investment at any time, given the prices don’t typically rely on the climate of the local real estate market. However, there are a few key tips you need to keep in mind before jumping into ‘excited buyer mode’.
What is the perfect fixer-upper property?
The best house renovation purchase is the one that will gain a lot of interest from buyers in the future, but nobody wants right now.
Superficial defects such as peeling paint, old and worn carpets and dated fixtures should not put you off buying a property, as these flaws are easy to repair or replace.
Many first homebuyers find it difficult to see past imperfections such as these, which is why homes like this tend to languish on the market for months on end. But if you are willing to put in a little elbow grease to improve the aesthetics of the new purchase, a fixer-upper like this could be the ideal fit.
Signs a fixer-upper should be avoided
Not all properties have potential, and turning a rundown house into a desirable property depends on a number of factors.
One of the most important factors when buying a house is the location. Avoid houses at a busy intersection, next door to a school, or uncomfortably close to a loud or (often smelly) industrial area. Even the nicest homes will struggle to sell in busy or noisy locations like these.
Instead, you may try a nearby neighbourhood, or one that is up-and-coming, as you will be more likely to sell at a profit down the line.
The importance of a good floor-plan
I’ve inspected way too many homes with terrible configurations. I mean, a three-bedroom house that only gives access to the bedrooms through a tiny walk-though kitchen is one I would definitely avoid – especially if you’re a family with young children or those who are house sharing.
The layout of your potential purchase should flow. Avoid planning to knock down walls if you are feeling impulsive and just want to buy that fixer-upper with a shoddy floor plan because it’s cheap. Remember that bedrooms dispersed at opposite ends of a house will not attract buyers with young children. Likewise, a two-storey home where the primary bedroom is located upstairs while all the other bedrooms are downstairs is inconvenient to many buyers.
A kitchen with more than one entrance is desirable, but as I mentioned, steer clear of those that become a thoroughfare. You will also want to ensure the floor plan of your potential new fixer-upper does not make the dining room the central focal point of the home, too.
Remember, the best type of fixer-upper is one that appeals to the biggest buyer market at present: those looking for a three-bedroom home (with a sensible layout!), and one with more than one bathroom.
And here’s another little tit-bit: four-bedroom homes can be just as desirable when it comes time to sell your fixer-upper, as owners of three-bedroom homes are known to upsize.
All fixer-upper properties will need work, but while some cosmetic issues are easy to repair and usually inexpensive, issues with the home’s foundations or those needing complete remodelling will pose a threat to your bank account.
Some problems that are easy to fix include:
· Peeling paint and wallpaper
· Dull floorboards, loose tiles or old carpet
· Ceiling fans and light fixtures
· Old outlets and light switches
· Broken window panes
· Leaky toilet seals
· Repainting kitchen cabinets or installing new ones
· Repairing old doors or replacing them with new ones
· Painting the exterior
· Building a deck
Some expensive repairs you will need to thoroughly assess before buying include:
- Adding central air conditioning
- Fixing foundations
- Replacing or repairing the roof
- Replacing all plumbing, sewer lines, and electrical wiring
- Creating new driveways, sidewalks, or steps
- Installing new windows throughout the home
- Completely remodelling the kitchen or bathrooms
- Building a garage or additional room
Spend wisely now and reap the benefits later
People buying fixer-uppers must make their purchase offer at the right price. If you consider the cost of future renovations in your offer, you will essentially start making money the day you close. Understanding that the right time to think about selling a fixer-upper is the day you buy it will ensure you make sound decisions from the very start.
So there you have it. Remember to avoid properties with nightmarish faults that will cost an arm and a leg to fix, as well as those situated in a location that is detrimental to your ability to live peacefully. You will also want to consider your own building knowledge and renovation expertise before diving headfirst into the property market for a fixer-upper that could take years to renovate.
With that said, good luck! You’ve got this.