The real estate market can be incredibly competitive, but fewer prospective buyers are interested in the time and effort that goes into renovating a fixer-upper. Purchasing a fixer-upper can help you avoid a drawn-out process of making offers, waiting, and repeating after a competitor’s offer is accepted.
The offer is the primary barrier between you and your new property, and a home that requires renovation will always have a lower purchase price than a comparable move-in ready house, and since property taxes are based on a home’s purchase price, you have an opportunity to save twice.
That lower initial purchase price can be your potential gateway to a desirable neighborhood that is otherwise out of your price range. The homes surrounding yours can have a huge impact on resale value.
Maybe the greatest benefit to buying a fixer-upper is the opportunity to personalize every little detail of your new purchase. Knock down a wall. Pick ornate finishes. Place built-ins everywhere. When you purchase a blank slate, all the details are yours to fill in.
The lower purchase price doesn’t lower a buyer’s risk. In fact, a fixer-upper may increase your risk profile. Houses that need renovation often have hidden costs. Pulling up flooring might reveal asbestos. Lead-paint gets revealed. These items and more all require expensive and immediate mitigation. This is one of the reasons that 4 out of 10 fixer-upper projects go over budget.
An additional risk that many buyers overlook is carrying costs. You may be able to execute minor renovations while you live in a home, but any larger projects will require you to be in a separate residence, forcing you to carry two payments at once. And if a major life-change happens before you are able to complete the renovation, selling a home stuck at an in-between stage can be extremely difficult.
The risk of having to sell a home before the renovation is complete is very real, because finishing a fixer-upper is a very time-consuming process. Can you and your family commit to what is essentially a part-time job in addition to your current schedule? If not, then you may need to look at a move-in ready option.
Whether you are a first-time buyer, an experienced homeowner, or an investor looking to enter the world of real estate, there are myriad factors that go into matching people and properties. A professional realtor is the matchmaker to guide you through that process. Contact Jessica & Sarah today to discover Eastern Iowa’s best homes, selected just for you.