Do You Have What it Takes to Tackle a Fixer-Upper?

Buying a house that needs renovations can be a great way to find a deal, but the choice between a move-in ready home and a fixer-upper is about more than just the purchase price. The cost of renovations, the time you have available to tackle DIY tasks, your timeline for moving in, and your risk tolerance all play an essential part in making the right choice. If you have what it takes to tackle a fixer-upper, you may be able to customize your home and save some money on the purchase price.

• Can Your Budget Accommodate Renovations and Unexpected Costs?
  Naturally, the draw of a fixer-upper is that you can purchase it for a much lower price than a similarly sized and located move-in ready home. The trick is deciphering exactly how much work the home needs, how much it will cost, and whether the combined renovation/purchase cost of the home will ultimately be more affordable than buying a house that's ready right now. When calculating renovation costs, it's also important to budget for the unexpected, because there are often surprises when renovating an older home.
• How Much of the Work Can You Handle Yourself?
  One way to keep renovation costs down when buying a house is to handle as much of the work as possible yourself, but it's important to be realistic about what projects truly qualify as DIY. If you have experience in the contracting trades or have renovated a home in the past, then you may be able to tackle some of the more costly aspects of renovating. Most people who are buying a house will be able to handle smaller renovation tasks DIY but will need to leave the bigger, more costly aspects of renovating to the pros.
• How Soon Do You Need to Move In, and Do You Have a Place to Stay?
  When we talk about surprises during renovations, we don't just mean in terms of cost. Time is also an important factor. If you have a place to stay and don't need to move into your new home right away, then time may not be a major issue. If you need to move in ASAP, then a fixer-upper probably isn't the right choice when buying a house.
• Do You Have Trusted Service Providers?
  No matter how much or how little of the work you can handle DIY, you'll likely still need contractors, an architect, and other service providers to tackle key tasks. It helps to have people you know and trust – or referrals from trusted sources – when coordinating work on a fixer-upper. Having quality service providers helps keep added costs down, and makes it easier to keep the project on schedule.
• Do You Have a Vision for the Home You'd Like to Create?
  Success with a fixer-upper depends in large part on having a plan and being able to see it through to completion. So it's essential to have a vision of the home that you want to create. If you don't have the desire to customize every detail, then buying a move-in ready house may provide more value for your investment.

While there are risks involved, buying a house that needs work can allow you to maximize your budget and customize your new home to your preferences. The key is to be honest with yourself about whether a fixer-upper fits your needs, and set clear goals when buying a house.

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