Before you even start to look at houses that are on the market, you want to figure out what your long-term goals are for this property. For example, if you want to turn it into a multi-family rental property, you’ll need to buy a house that has enough space to act in this manner. On the other hand, if you want to rent it out for a few year and then move in when you retire, you must consider the location you would like to spend your retirement in.
Know How Bad It Is
Some people are eager to purchase a fixer upper because they want to get right to work. They assume that any problems they encounter can be solved. Still though, avoiding a pre purchase inspection is very foolish. This type of house inspection can let you know if there are problems that are beyond reasonable repair. A home that needs a new kitchen is a lot different than a house where the foundations are crumbling to the ground.
Be Realistic with Time Limits
Chances are, you have a decent idea in your mind of when you would like this project to be finished by. Keeping this timeline in focus as you look at different houses is extremely important. For example, if the house needs to be torn completely down and built up from the base, it’s unrealistic to think that your going to be moving in any time in the next couple of months. The amount of time that you have is very much related to the condition that the house is in.
Look at The Surrounding Area
Sometimes, many houses in one particular area fall into disarray because the neighborhood has gone down. Crime might be an increasingly intense problem, and the schools might be suffering. Of course, you do not want to take the time to fix up a house and live in an area like this, and many other people do not want to either. Don’t assume that a buyer or rent exists for every house. If that was the case, someone else might have snatched up the property earlier, or there might not be so many abandoned houses in the area you’re considering.
What You Can Reasonably Accomplish Yourself
Don’t have delusions of grandeur about what you are able to reasonably accomplish in the house by yourself. Even if family members and friends often to contribute, you must remember that they need to go on living their own lives too. You are better off determining what you are able to do alone and how much you can afford to pay professionals to help you with the task.
Setting a Budget
On top of the purchase price of the house, you are going to need the money to make repairs. In some cases, you can take another loan out from the bank that will cover the cost of the repairs. This amount can be added on to your mortgage, and you can pay for it month by month. However, it’s also possible that you won’t qualify for a higher loan amount or that you simply will be unable to afford all of these repairs. Thinking practically about the cost is a necessity.
A fixer upper is an excellent opportunity to craft a house that you love and to live in your dream neighborhood, but you need to keep these concerns in mind when doing so.