Buying a fixer-upper can be an enticing prospect for adventurous homebuyers seeking a unique blend of affordability and the opportunity to put their stamp on a property. 29% of United States non-homeowners, Gen Zs, and millennials would be interested in purchasing a house they can renovate.
But with rising costs of living and housing prices, it can be a daunting task. To get into the housing market, younger people are making several sacrifices. One such choice can be to buy further away from major cities or to purchase a place that needs a little work.
However, like any major decision, there are advantages and disadvantages to consider before embarking on transforming a fixer-upper into your dream home. This article will explore the pros and cons of buying a fixer-upper to help you on your journey.
Pros of purchasing a fixer-upper
Affordability
The associated lower costs are a significant benefit of purchasing a home that needs some work. Fixer-uppers are often priced lower than move-in-ready homes, allowing buyers to enter the real estate market more cheaply.
Creative expression
Renovating a fixer-upper provides an exciting outlet for creativity. New homeowners can experiment with design ideas and architectural elements plus will get the satisfaction of turning a run-down property into a unique and charming space.
Potential for profit
If the renovations are done well, a fixer-upper can increase in value significantly. By putting in the effort, whether physically completing the work themselves or organising professionals to do so, homeowners could reap financial rewards. Savvy buyers will find a property that appreciates in the long run.
Learning experience
Taking on the project of a fixer-upper could be a valuable learning experience. The process can allow homeowners to develop new skills and gain a deeper understanding of home construction and improvement while expanding their tradesperson contact list.
Customisation
Renovating a fixer-upper allows homeowners to personalise and customise the space according to their preferences. This can be a thrilling task, as it provides for creating a home that truly reflects the owner’s taste and style.
Cons of purchasing a fixer-upper
Hidden costs
While the initial cost of a fixer-upper may be lower, homeowners may find hidden costs with the property. These unforeseen costs can add up quickly and take a serious chunk of your budget. Hidden costs with a fixer-upper could include structural issues, outdated wiring or plumbing, or poor waterproofing of space (to name a few!). As such, what may seem like a straightforward project could quickly escalate, leading to budget overruns and financial strain.
Time-consuming
Renovating a fixer-upper often takes longer than expected. This can be especially true for first-time homeowners who may need more experience in home renovations or for those personally completing the work themselves. This added time could be due to unforeseen issues arising, delays in permit acquisition, or simply changes in the original plan.
Stress and uncertainty
Renovations can be stressful, mainly when living in the space while trying to complete the work. This can lead to added tension, especially if unexpected issues arise or deadlines still need to be met. Additionally, renovations have inherent uncertainty, as unforeseen problems can arise, and plans may need to change accordingly. All of this can take a toll on homeowners.
Resale challenges
While a well-executed renovation can increase a home’s value, it’s not guaranteed. The housing market can be unpredictable, and there’s no way to know you’ll recoup all your expenses when selling the property. Buyers may appreciate different personal touches and design choices than homeowners, making it difficult to recoup the costs of renovations.
Skill and experience requirements
Renovating a fixer-upper requires a certain level of skill and experience. While some tasks can be done by yourself, others may require professional expertise, adding to the project’s overall cost. Homeowners may also encounter issues if they overestimate their ability to complete the renovations, leading to costly mistakes and delays.
Purchasing a fixer-upper can be an exciting and rewarding experience, but it’s not without challenges. While there are certainly benefits to buying a property that needs some work, it’s essential for buyers to carefully consider all aspects before making a decision. Buyers need to ensure they can secure a home loan to fund the renovation costs before committing to buy any property. And with 70 per cent of Americans aged 18-24 and almost 72 per cent of Americans aged 25-34 looking to purchase a home within the next five years, it’s no surprise that a cheaper house is an enticing option.
If you’re up for the challenge and have a realistic budget, a fixer-upper is the perfect canvas for creating your dream home. However, a move-in-ready home may better fit those seeking a more straightforward and immediate living situation.
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