Avoiding Pitfalls When Buying a Fixer-Upper Home

Avoiding Pitfalls When Buying A Fixer-Upper Home

Just as with purchasing a regular home, you probably want your purchase agreement to be contingent upon certain items. This is why it is essential to get a home inspection report early in the home buying process.

This allows you to build in some contingencies into the contract should you discover new information about the home in the course of the transaction. Some things that you want to think of as contingencies, if possible, include:

• Roof Contingency – Unless you specifically know that the roof is one of the big reasons why this home is a fixer upper you may want a contingency that the roof must pass inspection.
• Termite/Bug Infestation – any states require this as part of your home inspection no matter what type of home you’re buying but others may not. It’s always good to have a termite or destructive mold and/or pest infestation contingency in place because they may have caused major structural damage that would make the house completely worthless.
• Engineering Report – This inspection report confirms that the home is sturdy and can hold up to the tests of time. This is an important contingency since if the home is not sturdy it obviously will be worthless and end up having to cost you more money to take the home down leaving you with an empty lot.
• Sewage Lines – An inspection from an authorized specialist that can confirm the sewage lines from the street/road all the way into the home and through the home are in good condition and make the sale contingent upon this inspection being passed.
• Hazardous Materials – Be careful of hazardous materials such as asbestos, lead paint, and often as part of the engineering report you will be informed of any issues in the ground around the house; this often serves a purpose when a home is located rurally and could have pesticides in the ground or water or if the home is near things like landfills or drilling areas.

Repairs, Upgrades, and Fixes

If you are going to be purchasing a fixer-upper for the first time or if it’s going to be for your own home and not a flip to make money you may or may not be familiar with which repairs are going to be considered easy fixes and which are going to be considered more expensive fixes.

For the larger and more expensive jobs you may want to get quick estimates from professionals if it’s something you obviously can’t do yourself. Some of the easier & less expensive fixes that shouldn’t put you off when looking at a fixer upper include:

• Broken Glass/Windows
• Replacing Doors/Storm Doors
• Replacing or Installing Light Fixtures
• Replacing or Installing Ceiling Fans
• Adding a Deck or Patio
• Replacing Faucets
• Painting
• Removing Wallpaper
• Patching Small Areas, Holes & Cracks on Walls
• Replacing or Adding Trim or Baseboards
• Re-facing, Replacing, or Painting Cabinets
• Repainting the Home’s Exterior
• Replacing Light Switches, Receptacles, & Covers to both
• Replacing Carpet or Laying Tile/Faux Wood Flooring
• Replacing Toilet Seals or Inserts in Tanks

There are also some repairs that you want to either make sure you’re either experienced with, have someone experienced that can help you, or get estimates on because they are not only often troublesome but can get expensive. These repairs or fixes can include:

• Remodeling the Inside Structure/Replacing & Removing Walls or Opening Up Areas
• Concrete Work – sidewalks, steps, driveways
• Replacing Windows Throughout The Home
• Adding on a Garage (which is a big selling point)
• Remodeling Bathrooms
• Remodeling the Kitchen
• Adding Central Air Conditioning or Replacing Current HVAC Systems
• Roofing (Especially when it involves removing layers of roofing & then replacing the shingles)
• Updating or Replacing Plumbing, Sewer, Electrical
• Updating, Repairing, or Replacing Wells
• Foundation Work (Including Shoring Up the Foundation)
• Replacing Bathroom and/or Kitchen Plumbing Fixtures
• Adding on Rooms

Cosmetics vs. Renovations/Repairs

Obviously if you can look at a house and see that the foundations of the home are solid and all you will really need to do are cosmetic repairs it’s a definite plus. Many people have problems seeing a diamond in the rough and can’t get past the ugly unkempt surroundings. There are a lot of quick, fairly inexpensive, and easy repairs that can turn that fixer-upper into a beautiful home, ready to move in within a fairly short time after buying the place.

The more costly and time extensive issues to deal with are complete overhauls and major repairs that involve plumbing, electrical, and foundation repairs. Often when dealing with plumbing and electrical problems you will find that what appeared to be a small repair can end up being a major problem. 

A perfect example of this is repairing a leaky toilet only to find the subflooring needs replaced and even the entire toilet. Depending upon the age of the home one problem can often lead to another simply because repairing items becomes impossible due to their age and you have to often completely replace the entire item.

The best advice you can take with you when choosing a fixer-upper is to do so with guidance of another professional covering all of the repairs before you sign the papers to buy. The biggest problem with this is that fixer-uppers usually sell for well under what the home would be worth in the market if it were in good condition and those that know about flipping houses for profits act fast.

If you find a home you really love that’s in a neighborhood you want and it’s a fixer-upper you may want to put a bid in with a down payment and a list of contingencies that consider the high cost items. This can buy you a few extra days or weeks to cover all the angles and know how much things are going to cost if you can’t do the repairs yourself. Basically if you’re a person that can see past the outer appearances of the home you may find that you can have a dream house for a fraction of the cost you would expect to pay.