We’ve all seen those home improvement shows where they buy an old house that needs work and transform it into an amazing home. And houses that need fixing up are usually more affordable than homes which are move-in ready.
Is buying a fixer upper home right for you? Check out these pros, cons, and tips and decide for yourself!
What are the pros of buying a fixer upper house?
- More affordable. A fixer upper is typically less expensive than a ready to move in home. Your down payment and monthly costs will also be lower, which can leave you more cash to pay for renovations.
- Lower taxes. Since you are buying a home with a lower value, the property taxes will likely be lower too. Your home’s value could be reassessed after you complete renovations, however.
- More customizable. A fixer upper puts you in control of how you want your home to look. You choose the tile, flooring, colors, and layout in each room to fit your needs.
- Less competition. Fewer homebuyers are interested in a fixer upper. This can help you pay a lower price and give you more ability to negotiate.
What are the cons of buying a fixer upper house?
- Cost of renovation. A whole house remodel can be expensive. Depending on how much work you need to do, you may end up spending more money than you would have if you bought a ready to move in home.
- Unknown expenses. With an older home, you may uncover issues that your home inspection did not find. These surprise problems can put a strain on your budget.
- It takes a long time. Fixing up a home can take months or years depending on the work that needs to be done, the money you have to do it, and the time the renovations take. This can mean living in a construction zone or paying for temporary housing.
- Added stress. Renovations can be stressful whether you are doing the work yourself or paying contractors to do it for you.
What are tips for buying a fixer upper house?
- Get the home inspected. While an inspection might not find every problem, it can help you identify problems and estimate the cost of repairs. A home inspection can also help you prioritize what work needs to be tackled first.
- Negotiate. With a fixer upper, you often have the upper hand in negotiations. The seller is less likely to have many offers and will be more willing to negotiate.
- Estimate the costs. You should consider the cost of the home as well as the estimated cost of renovations. You don’t want to buy a home then realize you can’t pay for all the work it needs.
- Decide what you can do yourself. You can save money if you tackle some of the improvements yourself. It’s best to hire a professional for structural, electrical, and plumbing work however.
Talk to us about buying a home
Freedom Mortgage can help you buy a home with conventional, VA, FHA, and USDA loans. To speak to an experienced Loan Advisor, please visit our Get Started page or call 877-220-5533.
Last reviewed and updated December 2022 by Freedom Mortgage Corporation.