How to find a good Fixer Property
You want to find a property you can flip but not one that is on the verge of falling down, right? Here are some tips to help you find that perfect fixer upper:
Four rewards for buying a fixer property:
- You might be able to find a better home in a nicer neighborhood than you might otherwise be able to afford.
- You can buy decorations and furnishings according to your own taste and make the place your style.
- You can usually increase the value of the home with your own sweat equity.
- You can often resell it for a profit.
A good rule of thumb is that for every $5000 you put into a home you may be able to recoup up to $15,000 of that back on the sale of the home depending on the market and the fix up's you choose to complete.
Know the neighborhood value and don't over improve otherwise you may get stuck not being able to recover the costs.
Who should NOT buy a fixer property?
- If you have no fix up cash or costs set aside
- You don't have any mechanical or handy ability
Keep records of you time and your money so you can budget these costs in and determine if this is really worth your expense.
Things to look for when buying a fixer upper:
- A neighborhood that is appriciating - pride of ownership through out the area.
- Check the comps in the area which I can do for you to make sure you are not over paying for the home.
- Always have an inspection done. Know the condition of the home before you buy so you know what work you have to do.
- Get three competative bids from contractors before you make your offer. Don't just get caught up in the emotion of it, you want a realistic look at what you will need to be spending.
- Stay away from structural problems as in major foundation work or load bearing walls needing major repair. This also includes plumbing and electrical issues.
The Ideal fixer is the cosmetic home. Paint, flooring and landscaping can sometimes make a world of difference to the overall appeal of the home.
Keep these rules in mind when looking at fixers:
- It will always be more work than you expect.
- It will always take longer to finish than anticipated.
- It will always cost more than you expect.
Biggest tips is to buy the cheapest house in the best neighborhood! And make sure ahead of time your renovations will pay for themselves. The last thing you want it to get into a home purchase just to shell out more then you can recoup.