The Advantages of Buying A Fixer-Upper

For many people beginning their home search, they start the process by looking for the perfect home that has all of the features that they are looking for. Whether it is a gourmet chef’s kitchen, crown molding in the master bedroom, or hardwood flooring, there are certain features that make a home desirable. Unfortunately this isn’t always possible, whether it is due to the price of the home or the available inventory of homes for sale. This leaves buyers with two choices: wait for their dream home to hit the market, or make their own dream home.

There are two general categories of renovations to consider when thinking about the purchase of a fixer-upper: repairs and upgrades. Repairs are maintenance items that are required as a part of the home’s upkeep, whether they are needed immediately or in the near future. Things that fall into this category include replacing an aging roof, HVAC, or water heater, as well as updating plumbing and windows. If a home is in a state of needing repairs of this nature, then that is generally priority number one once the purchase of the home has been completed. The good news is that when maintenance like this has been deferred by the seller, there is often a discount on the price of the home and buyers have the opportunity to purchase at a lower price than a fully maintained home. 

The second category of renovation is upgrades. These are either cosmetic improvements such as new paint, adding granite countertops, or new appliances. This allows you to add a personal touch to the home that isn’t possible when buying a home that is “turnkey,” or already upgraded and ready from day one. 

For those who are interested in purchasing a fixer-upper but are concerned about renovation costs, more and more lenders are offering renovation loans that can be rolled into your mortgage when you purchase a home. This is a big benefit that allows you to avoid putting down a significant amount of money for your down payment only to have to spend even more on the renovations after closing. Our team works with a number of local lenders who would be happy to go over options that are available to you to make your dream home a reality, and if you are ready to start your home search be sure to give us a call!

To learn more about financing for home renovations, take a look at this article from the Wall Street Journal.