Oh, the dream of flipping a home and turning it into a dream house, worthy of being featured on home improvement networks around the world. The growing popularity of such TV programs has caused the trend of purchasing fixer-uppers to skyrocket, something that is not exactly in the best interest of homebuyers. Many who have followed this trend do not realize the level of risk associated with taking on such a responsibility. Here, we’ll walk you through a few things to consider when you’ve got your eyes on a fixer-upper.
The Appeal of a “Deal”
Many people are drawn to the opportunity of purchasing a fixer-upper because of the supposed deal they’ll get from a lower price tag. Unfortunately, the price of the home does not represent the entire picture of what your financial obligations will be upon purchase. Fixer-uppers are an investment – some people carry this investment throughout their lifetime.
From a superficial standpoint, a fixer-upper may look like a great opportunity to increase the equity of the home’s value. If ever you aim to sell the home, you’ve significantly improved your chances of making a profit, so to speak, since you were able to secure the home at a discounted price.
Still, you have to run the numbers: Sure, you can save money by doing some of the renovations yourself, but you must determine if the repairs are worth the massive investment of both time and money. The cost of flipping a home can get out of control very quickly.
As you progress in the project, you may begin to notice damages here and there that only add to the list of things to be addressed for renovation. Finding rotted wood, degraded insulation, or outdated piping, for example, are some of the most common elements that contribute to rapidly rising costs of tending to a fixer-upper.
Consider Your Skillset
TV house flippers make the job look incredibly easy – you knock a few walls down, slap some paint on the interior, and voila! You have a brand-new home! Unfortunately, it’s not that easy, and not everyone is gifted with the skillset to successfully flip a home.
If you’re not experienced in this field, you may end up having to hire someone to assist you, as you won’t be able to renovate the home on your own. This is another factor that can quickly eat away at your budget, leaving you with little money left to complete all the renovations you had in mind.
On the other hand, learning such skills can be a great way to prepare you for home maintenance in the future. Still, you must recognize that learning as you go will significantly increase the time required to complete your project, and you may not be able to move into the home when you originally planned.
Take all of these factors into consideration if you’re thinking of purchasing a fixer-upper. Although the TV home improvement gurus make the job look easy, there is a lot to consider for the average house-hunter.
