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The pros and cons of purchasing a fixer-upper

Is a fixer-upper the right property type for you? Many people become home owners, but most of us choose to purchase move-in ready properties. However, some people enjoy the experience of taking an old home and making it feel new again. If you are considering buying a fixer-upper, here are some of the top pros and cons to think about first!

Pro: You have plenty of flexibility

Buying a fixer-upper is the second-best way to fully customize your home, after building your own house. This is because much of the home will need to be repaired, replaced, or renovated in some way. Part of the appeal of a fixer-upper is the chance to give it your own style. When you are gutting the kitchen and bathrooms, you probably won’t want to recreate the dated look they likely had before. This is the perfect chance to flex your creativity to make this house truly feel like home. Flooring, walls, countertops, sinks, furniture, windows, and even baseboards are areas you will have to evaluate. You will probably come across design decisions you have never thought about before, but will now have the chance to customize. This can feel overwhelming for some people, but many people who purchase fixer-uppers do so partly so they can have this kind of freedom with style.

Pro: You can focus on location

Buying a pre-built home means you must carefully evaluate the property itself, and not just the land it stands on. If you plan to move into your next home without tearing it apart and renovating it first, it is important to ensure it meets all your requirements ahead of time. While this is a common part of the buying process, it can still feel stressful to juggle so many priorities. However, when you buy a fixer-upper, you can place less importance on how the house looks. Sure, it should meet your needs in terms of size, but apart from that, you can customize the house to be whatever you want. This gives you more freedom to consider location. You can prioritize where you live, whether that is in a city, suburb, or rural setting. Location is very important for many home owners, and buying a fixer-upper allows you to make it a key consideration.

Pro: The price of the home will likely be lower

Perhaps the biggest appeal of buying a fixer-upper is the cost of the purchase. In general, these types of homes are cheaper to purchase than move-in ready properties. This isn’t a surprise, because the value of a fixer-upper is likely much lower than other homes due to lack of care, neglect, age, renovation needs, etc. These homes will not sell at market value, so you can purchase one for below the typical price of properties. Plus, once you make the necessary repairs, the home will rise in value and you will build home equity much faster than buying a move-in ready property. This is an advantage for people who are considering buying the home to fix it up and sell it again.

Con: Necessary repairs will be costly

A huge part of buying a fixer-upper is committing to the repairs it will need. If you have ever renovated a home before, you know they are expensive. When you are taking on a project of this size, the costs will be fairly huge. Not only will you need renovations, but you will also have to invest in repairs, replacements, and various professional services to get the job done. You are essentially giving the house a complete makeover. 

While budgeting is important when buying any home, you should prepare to have a more flexible budget with this type of purchase. Unexpected expenses always pop up when fixing up a home in disrepair, and it’s essential to have the funds ready to support the work that must be done. We encourage you to have a budget and stick to it as closely as you can, but to also accept the likelihood of reaching a higher price point.

Con: Delays are inevitable

With a project of this magnitude, even the most organized plans and professionals are bound to run into delays. This could be an issue with supplies, a stubborn problem that needs more time to fix, or a whole range of other factors. There are so many moving parts to renovating a fixer-upper, and at some point, there will likely be setbacks. This is not meant to scare you off, but to help you prepare for how the process will feel. It’s important to be flexible and committed, and to  have other accommodations until your home is officially ready for you.

Purchasing a fixer-upper is a big leap, and one that brings the right type of buyer a lot of satisfaction. Be sure to carefully consider your options before committing to this type of purchase, and to be realistic about your own expectations and preferences. Buying a fixer-upper isn’t for everyone, but no matter what kind of property you buy, you need a mortgage broker on your side! Feel free to reach out if you are getting ready to enter the housing market, and we will set you up for success.

If you have any questions about your mortgage, give us a call at Centum Home Lenders! You can reach us at 506-854-6847, or get in touch with us here.