If you are thinking about buying a fixer upper, learn how to avoid a money pit!
Getting a great deal is always attractive, especially in today’s real estate market. If you are thinking of buying a home and you see a fixer-upper for a cheap price, you are going to be interested. But you need to be careful – sometimes that bargain house turns out to be a money pit.
Today, many home buyers don’t want to worry about remodeling or repairing a home. Brand new houses or those that are move-in ready are highly desired. But these homes often come at a steep price. This is why many home buyers think that buying a fixer-upper and remodeling could save them a ton of money.
Fixer-uppers are popular because they may be the only affordable home in a quality location. Plus, home improvement reality TV shows persuade quite a few people to buy a home that needs work.
The ugly but honest truth is that a fixer upper can become a money pit that wipes out your savings! Here are some things to look for so you can identify the fixer-uppers that are truly a great deal!
Looking at Homes for Sale: Start High
You need to look at the roof before you even bother entering the home. If the home needs a new roof it can cost big bucks to repair or replace. Also, the damage from a leaking roof can be extremely expensive and lead to the growth of mold.
Look for cracked, curled and missing shingles. The gutters and downspouts should collect rain and direct it away from the house.
Buying a home: Always Check the Basement
The basement should be the 2nd stop on your tour. When you look at the basement, don’t think about storage possibilities or adding a man cave!
To understanding the true quality of a house, go to the basement. The basement gives you valuable clues about the condition of the HVAC, plumbing, and electrical system. Plus it will tell you how well prior owners have taken care of the house.
Steer clear of sagging floor joists, old and inefficient HVAC systems, leaky water heaters, and electrical panels that resemble a rat’s nest. This is important since this stuff can cost a lot of cash to repair.
Pay attention to cracked or buckling walls which can be waiting for a heavy rain to spring a leak. Your nose can be especially helpful so pay attention to any damp smells. Damp smells or stains on the floors or bottom of the walls may indicate repeated standing water.
Always Check the Foundation
A home’s foundation is essential in keeping the home’s structure safe, strong and sound. The most significant problems in a home usually develop as a result of foundation issues. You can’t do a complete structural inspection but you can easily look for a few red flags.
Look at the distance as well as the size of the trees close to the house. If there are big trees close to the home, the roots could cause the foundation to crack or break.
On the inside, examine the floors for cracks and gaps. Look for any uneven floors also. Look for cracks in the drywall, specifically in the corners and around windows. These clues can indicate a foundation problem.
Never Buy a Home in a Bad Location
There is one thing about a home that can’t be fixed: the location! Think about what you are looking for in a new home – distance to schools or work and stores. If you are going to double the time you spend in the car and how much you spend on gas, maybe you need to reconsider a home! But if the general location is OK, there are a few more things to consider.
It is a good idea to look at a potential property on a rainy day. Try to schedule your visit after it rains. Look to see if water collects around the foundation. This is a bad sign because it can leaks or foundation problems.
Another suggestion is to talk to the neighbors about the property. People like to talk and it is amazing what they will tell you if you listen. The neighbors can reveal how often they noticed workers taking care of the home. Or when it was last painted, etc.
Learn everything you can about the neighborhood. Some homes that sound like a great deal could be located in less appealing areas. Knock on doors on the street and talk to neighbors about crime. Your job is to evaluate exactly how desirable a neighborhood is and if it’s acceptable to you.
Although you may not have children in school, the home’s next buyer might. The school district has an impact on the value of a property. So find out about the ratings of the schools. Get neighborhood criminal activity statistics from the police. Check the sex offender websites.
Mold: The Deal Killer
I mentioned damp smells in the basement earlier and there is a very important reason to be leery of damp smells. Damp smells and moisture problems can be a very serious health issue. Unaddressed moisture problems can cause mold troubles. For house buyers, the clues can be difficult to recognize. Pay attention to strange odors that don’t appear to have any specific source. Moisture problems can mean mold problems.
You really need to read about Mold: The Hidden Killer in Your Home
Don’t Buy a Home With a Bad Layout
Search for a layout you’ll be able to deal with. Moving load-bearing walls can be an high-priced undertaking and should be avoided. Same with adding on to a home if it does not have enough bedrooms and bathrooms.
In any house, the floor plan determines if the home will suit your needs. Focus on the way the home is arranged – like where the other bedrooms are in relation to the master bedroom. Is there a bathroom that will be convenient for guests?
Money Pits Have Bad Plumbing or Electrical Wiring
If the plumbing or electrical requires replacing, it is best to mark a fixer-upper off your list. The price of repairing those problems can be greater than the money you save on the house itself.
Bathrooms need a close look because water leaks and moisture can cause rot and structural damage. The use of galvanized steel or iron pipes is usually a warning sign. Sediment can build up in the pipes causing them to corrode and leak.
Modernizing the electrical wiring is a significant expense. Look for substandard wiring such as single, fabric-covered wires on white ceramic insulator knobs. This is often called knob and tube wiring and should be a deal breaker! You will find knob and tube in very old homes.
Look at the breaker box. It needs to be at least a 200-amp box. Make sure it is a new circuit breaker type box and not the old school screw in fuse box. Also look for aluminum wiring because it is a potential fire hazard.
Upgrading a home’s plumbing and electrical are serious deal killers and should not be ignored!
Look At Not Through the Windows
Have the windows been updated to the newer energy efficient tilt in vinyl type? Old windows are a significant reason for high power bills. Replacing old wood windows with energy-efficient models isn’t cheap.
Money Pits Are Expensive to Heat and Cool
The older the home, the more likely it’s going to be that you’ll need to update the HVAC systems. Check the HVAC units for installation dates or when they were built. If the home doesn’t already have ducts run, it can be a part of your renovation spending plan.
You must consider what it will cost you to heat and cool the home. Ask for copies of the average utility bills for the past 12 months. This way you can be ready for the cost of staying warm in the winter.
Don’t Be Fooled By Smoke and Mirrors
Some people will do cheap work in a way that makes it very hard to tell they are using “smoke and mirrors”. If a home has had extensive remodeling and is still listed as a fixer-upper or is being sold AS-IS, be very leery.
A Money Pit Has Bad Bones
Again, the first thing to look at is the roof. Then the foundation. Look at the structure of the home and make sure it is in good shape! This is the most important thing to look at when checking out a fixer-upper!
The bones of a home is the physical structure of the house. You need to look at the load-bearing walls, the foundation, the roof. The structural integrity is the most important factor when considering a home. When there is anything at all dubious about the bones of a home, run away!
These are the problems that will take the most time and money and energy to fix. They are often the cause of blown renovation budgets!
Last But Not Least: Get a Home Inspection
If the home you like has passed all of these quick checks, a home inspection contingency is in your future. Or it better be!
You need to hire a licensed home inspector to professionally look at the structure from top to bottom. Don’t buy a home without a professional inspection.
You can locate home inspectors in your area on the website of a national organization like the American Society of Home Inspectors.
Tag along as the inspector tours the home if you can. You’ll learn a lot by seeing it through the inspector’s eyes.
The Take Away:
It is very understandable to want a good deal when looking for a house even if it is a fixer upper. Just remember these tips so you can avoid a money pit. If you have any questions about buying or selling real estate in the Anderson SC are, shoot me an email!