Buying a Fixer Upper

By, Lisa Roberts

Searching for a home to purchase on a tight budget can be challenging. It's far from an easy thing to achieve. And when you realize this, you might consider buying a fixer-upper house. But, what can you expect from such a project? Can it be a worthwhile investment, or should you save for a move-in ready home?

 Unfortunately, no one can give you an exact answer to these questions. There are too many unknowns involved, so it's hard to tell. However, we can help you make your decision by informing you about all the pros and cons of buying a house like this. And when you think about them, you'll know if what you have on your hands is something you're willing to dive into. 

What is a fixer-upper?

Before we start talking about all the pros and cons, we feel it's essential to clarify what this term means. A fixer-upper is a home available at a lower price because it needs plenty of maintenance work. 

So, we're not talking about houses for which you can follow tips to enhance curb appeal and nothing more. These will usually need some substantial work. Of course, this isn't necessarily a bad thing, as you'll see. And in that spirit, let's start with the upsides.

 

Buying a fixer-upper house means buying a home that needs a lot of work.

Pros

Lower price

Without a doubt, one of the biggest pros of buying a house like this is the price. These give you a chance to buy a property you may not be able to afford otherwise. 

So, if you're a first-time homebuyer, this might be an excellent opportunity for you. Chances are that you're young, so you won't find it hard to deal with all the things involved. And you will get an opportunity to climb up the property ladder a lot faster. 

You can significantly increase the value of the house

With a fixer-upper, there are a lot more ways to add value to the property when remodeling. However, you need to be careful and plan this project to the tiniest detail. If you don't, you may end up with nothing more than an endless list of bills. 

An updated bathroom and kitchen can give you a fantastic return. So, getting a home that needs these updates is always a good idea. On the other hand, don't go overboard with swimming pools and decking. These rarely pay off, so it's better to avoid them. 

Tax savings

If you're preparing to buy a home, you must have heard about Stamp Duty. It's a form of property tax, and it's based on the home's sale price. Hence, if you buy a fixer-upper, you'll pay lower tax. 

It's worth mentioning that if you're a first-time homebuyer, this may not apply to you since you don't have to pay the Stamp Duty if you're buying a property worth up to $300,000. 

On the other hand, other buyers can save a lot of money this way. On top of that, you can get even more money back with Value-Added-Tax. You might be surprised how cheap such a house can turn out to be. 

 

You'll be able to save a lot of money on taxes, especially if this isn't the first house you're buying.

You can create your dream home

And the final pro of buying a fixer-upper house is that you'll get a chance to make it your dream home. You don't have to settle for someone else's taste in interior design. Instead, you can choose where you want to invest your money.

You can go whichever way you like here. Create a luxury hotel-style bathroom or a big dining room in which your whole family can enjoy meals. You can imprint the fiber of your being in this place if you want to. The sky is the limit. 

Cons

You might go over budget

The thing with fixer-uppers is that you'll need a budget to buy it and repair it afterward. So, things can get expensive pretty fast. Here are just some of the things that can make you go over the budget.

• Electrical rewiring
• Re-plastering
• Installing new plumbing
• Mold and dry rot

All of these can be very expensive. And if you don't research as you should, you might even be unaware of them as problems. So, be sure to learn about the property before buying. This is the only way to play it safe.

It can be harder to finance

Although it can save you a lot of money, it may be harder to get a mortgage for a property that needs work. Some lenders will only work with you if you're buying a habitable space with a working kitchen and bathroom. And if they don't like what you're planning to buy, they can retain the funds. 

So, it can be a bit trickier to get your hands on the money you need to buy such a house. And that brings us to the next point we want to address.

 

It can be hard to get all the funds you need to buy a fixer-upper home.

Added stress

We all know how stressful it is to move from one house to another. However, with renovating on top of moving, you need to make tons of other decisions as well. There's also the factor of unexpected problems that occur at the most inappropriate time.

In essence, when you're done with your day job, you'll have more work waiting for you at home. And this can go on for months. So, it's clear it's not for everyone. 

However, if you consider all the things you should when choosing a house plan, you might be able to do it without any issues. You can arrange things in a way that ensures you don't miss anything and have your new home ready in a matter of weeks. It all depends on how good you are at working under pressure. 

Conclusion

The answer to whether buying a fixer-upper house is worth it is all up to you. If your needs, financial situation, and life goals allow it, it's a great idea. But if you don't feel like you can deal with the additional stress, better settle down for a move-in-ready home. 

Meta description: Learn the things you should know about when buying a fixer-upper house. Find out whether it is worth it and if you can make a profit.

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