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  • Should You Buy a Fixer Upper?

     

    Many home buyers have motivation for buying a fixer upper.  That is, a home that is not in the best of condition and so, is being sold at a low price.  One of the reasons that many buyers purchase fixer uppers is because of the low price.  Other buyers see fixer uppers as an investment opportunity.  Since the home can be purchased at a low price, fixed up, and then resold, it presents an opportunity to make some money on the home.

    If you are interested in purchasing a fixer upper it is important to realize a few facts about this type of housing.  First, it can take a lot more work to fix up a home, than you might first realize.  Not only does fixing up a home require work, it also calls for time and money – which many people do not have a lot of.  People who attempt to fix up a home for the first time often find that they have underestimated the amount of time and money that it would take to do the work.  Not only that, they also overestimate the value of the home after repairs have been made.

    That doesn’t mean that it’s impossible to make a profit from fixing up a home.  Instead, you should have a realistic view of home much time and money it will take to fix the home and the value the home will have once the work has been complete.  Lowering your expectations also lowers the likelihood that you will be disappointed when the process is complete.

    Are you thinking about living in the home while you fix it up?  If so, it might be an eye opener for you, especially if you have never lived in a home in such a condition.  It might be difficult to live in a home and fix it up at the same time.  Why?  Because you have to worry about the everyday living expenses.  Not only that, it can be easy to get caught up in making the home livable for yourself rather than make it saleable.

    If you’ve never worked on a fixer upper before don’t start with the most dilapidated home you can find.  Instead start with a home that is structurally sound, but in need of some cosmetic changes, like new carpet or paint.  You can do these kinds of repairs inexpensively either by yourself or by hiring someone else.

    You can often find good fixer upper opportunities through properties that have been foreclosed.  Often foreclosed properties can be purchased well below their market value.  A fixer upper that increases in value with some renovations can create a generous profit margin.

    Before you purchase a fixer upper property you should have it professionally inspected.  This will give you a good idea of what changes need to be made to the property.  Once you have a better idea of the exact investment you need to make, it will be easier to make a decision about the particular piece of property.  As long as you have a realistic view of the work that it takes to improve the property and the value you will receive, you can make an educated decision about a fixer upper purchase.

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