Investing in a fixer-upper is a great way to make some money off of the real estate market, but there are potential risks around every corner. Many new homeowners find themselves struggling with hidden costs and unexpected repairs that make this process expensive, time-consuming, and stressful. Here is a look at a few tips that will help you find the perfect fixer-upper at the right price.
Find a Good Inspector
Unless you happen to be a trained inspector yourself, you should find a trustworthy inspector who will guide you through this process. Many sellers and real estate agents maintain contact with local inspectors, but those professionals will not be looking out for the buyers. The ideal home inspector should be certified by the state and have extensive experience in the field.
Check the Key Systems
Even if you are willing to invest quite a bit of time and energy into a fixer-upper, most of the key mechanical systems should be safe and in good working condition. The primary systems you and your inspector should check include the electrical wires, plumbing, air conditioning, and heater. As a general rule, fixing those components will be much more expensive than simple cosmetic changes. Any damage that is found in those areas of the home can be used as leverage to bring the final price down.
Look for Easy Cosmetic Fixes
Some of the most lucrative fixer-uppers only have minor damage to the walls, floors, and ceiling. In these homes, you could potentially have a huge return on investment if you carry out simple upgrades such as painting the walls and installing new laminate floors with the help of a company like Georgia Carpet Industries. When you are taking a look at the damage, you should keep an eye out for any signs that there are serious issues just below the surface. That includes water damage, fire damage, stains, mold, and mildew.
Establish Firm Numbers Before You Make an Offer
One of the biggest mistakes a buyer can make is placing a bid without doing a fair amount of research. Buying a fixer-upper and hoping you will have enough money to finish the important projects in the coming months could land you in a difficult situation. You and anyone else who is investing in the home should have firm numbers regarding the initial investment, the cost of the fixes, and how long it will take to complete the upgrades. Having your assets tied up in a home that you cannot sell or upgrade could damage your credit for years to come.
Spending a little extra time on the planning stages of this process could help you avoid a major catastrophe that becomes a financial burden for you and your loved ones.