Planning on purchasing a fixer upper house?

Purchasing a fixer upper house can be a worthwhile, money making undertaking or could be a nightmare waiting to happen.  Consider these things before you purchase a fixer upper house.

What you can do yourself?

Attempting a remodeling job that you do not have the skills for will take longer than you think, lead to less-than-professional results and cost you more money in the end.

     Do you have the skills set?

     While tasks like stripping wallpaper and painting are fairly straightforward, others like electrical work can be dangerous when done by amateurs.

      Do you have the time?

      Are you able to take time off work and away from other responsibilities to renovate a fixer  upper.  If not, will you be living in construction for months while you complete projects on the weekends.

Do the numbers before you make an offer.

     Have your contractor do a walk-through of the house, so he can give you a written cost estimate on what he will do.

     If you are doing the work yourself, make a detailed list and price of the supplies.

     There are always unforeseen issues that will arise with a fixer upper house.  To cover these add on 10 or 20% to the costs of repairs.

Will you need any permits? 

Do you require a permit for the work that needs to be done?  How much money and time will this take to acquire? Doing work without a permit may save money, but will cause problems when you resell your home.

Decide if you want to get the permits yourself or have the contractor arrange for them. Permits take time and can be frustrating if you are unsure of how to obtain them. You may have to do additional work, or change the way you want to do a project, before they give you the permit.

Factor the time of obtaining permits into your plans.

Structural work.

Get written estimates for repairs before you commit to buying a home with structural issues. Shy away from homes that needs major structural work unless:

It can be purchased at a price that once the work is done there will still be profit

You have uncovered the extent of the problem and it can be fixed    

You have a binding written estimate for the repairs

Calculate your fair purchase offer.

Take the fair market value of the property (what it would be worth if it were in good condition and remodeled) and subtract the upgrade and repair costs.

This is where we, as Realtors, come in.  We can help you decided what market value of the house would be once it is fixed up and what a fair purchase price in it's current condition would be.

Call us at 519-495-1541 anytime and let us assist you!

Richard Thyssen, Broker of Record

Colleen Thyssen, Sales Representative

Direct: 519-495-1541

Email: rthyssen@rogers.com

www.thyssengroup.com