Tips for Buying a Fixer-Upper

There are so many factors to consider when purchasing a home. What neighborhood do you want to live in? How much space do you need? What’s the parking like? Once you identify the things you want for yourself, you then need to figure out your budget. Finding a place with all of the things you want within your price limit can be a challenge. This challenge is why it may be worth keeping your mind open to buying a fixer-upper. There are many types of fixer-uppers, some that need new appliances and paint, some that require a remodeled bathroom or kitchen, and some places that need to be completely gutted. Buying a home in need of fixing can be a lot of work, but it can also be a great adventure with huge pay-offs. Not only can you potentially afford a home in a neighborhood that otherwise might be out of your price range, but you can customize your home to your exact liking. Plus, there’s the satisfaction of really creating your living space. Each type of fixer-upper comes with its challenges and benefits, and it’s important to know what you’re getting into before you take the plunge. 

Make Sure You’re in the Right Mindset.

Buying a home in need of work is no easy task. It will take perseverance, patience, money, and effort. But being realistic ahead of time about what the process will entail and mentally preparing yourself will help you be ready for anything. There are many unknowns when doing renovation work. Perhaps a problem is found when you remove a wall or you discover issues with the electrical system. Knowing that there will be twists and turns in the process will help you keep your expectations reasonable. Know that a fixer-upper will take more time than buying a turnkey home and be prepared for the unexpected. 

Plan Your Finances Accordingly

Understanding the costs of buying a home in need of work is less straightforward than buying a more typical home. It can be tricky to know how much it costs to get renovation work done and how much work your home will need exactly. A good rule of thumb is to work 20% more than the buying price into your budget. So, for example, if you purchase a place for $100,000, you will likely need to put $20,000 of work into the home. The amount it takes to fix up your fixer-upper will depend on several factors. Factoring where you live, how large your house is, and what condition the place is in will affect the cost, but allowing for a sizable renovation budget will help set you up for success. 

Secure the Right Type of Mortgage

There are so many mortgage options to choose from. The good news is that there are specific mortgage options that can help you fund your renovation work. Some of these options even allow you to lump remodeling costs with your home buying costs so that you only have to worry about one loan. Make sure you have the money you need and research all of your options before choosing. 

All in all, the prospect of buying a fixer-upper may be daunting but it can be worth the extra work. The joy of finding a home in your favorite neighborhood that you can pour your heart into and make into your own is an exciting possibility. With these tips, you can be ready to explore if this path is right for you. If you are prepared to explore your options and look at homes in the Baltimore area, I’d love to help. Reach out to me through my website or give me a call at (302) 545-8569, and follow my blog for more home buying tips!