Before You Buy a Fixer-Upper, Read This

​1. Know that some flaws can be fixed

Fixer-uppers generally fall into two categories: total wreck and ugly house.

“An ugly house is not architecturally appealing: Its paint is chipping away, the yard is unkempt, inside it may smell bad,” says Baumbusch. In short, everything about it needs freshening up.

But if these are the kinds of flaws you’re dealing with, take heart: They’re merely cosmetic, and they’re easy to fix. Painting is the easiest task that you can do yourself. Just don’t cut corners—buy all the right equipment (use the tape!) and paint correctly, with the right number of coats. It’s extra work, but it pays off in the end. Even if you hire a painter, it won’t cost as much as redoing the bathroom. You could also refinish the floors yourself, although it involves renting a machine.

2. Then again, other flaws cost a bundle

On the other hand, some blemishes may initially slide under your radar—but eventually make a big impression on your wallet.

“Problems with the foundation, structure, roofing, and siding can be expensive to fix,” says Baumbusch—as can major replacements with sewage, septic, and heating, ventilating, and air-conditioning systems. Replacing decks and driveways can also be costly. Sometimes environmental problems such as a wet basement or mold can be mitigated, but treatments are not always successful. In some houses, it can just be impossible to solve a bad mold problem.

“I once viewed a property for sale where the mold was so bad, it was difficult to breathe,” says Baumbusch. “It was everywhere, and the property management company was doing nothing to stop it. That home would probably be better off completely gutted or razed altogether.”

3. Ballpark your renovation costs

Hire a structural engineer to evaluate the home before you buy—but before you even get there, do your research. There are a lot of repair estimators out there, so ask your friends and co-workers if they’ve done repairs lately and could tell you how much they cost. That way, you can quickly ascertain whether the repairs would fall within your budget. Draw up a reference sheet for renovation costs such as roof, foundation, HVAC, and windows. This will help you to determine a viable offer price.

4. Ask for a discount—gently

Now on to the real upside of buying a fixer-upper: major savings! These houses can go for as little as 60% to 80% of the original asking price, says Baumbusch. This is especially true if the home has been sitting on the market for a while, or if you’re able to offer cash upfront.

From Realtor.com By Rosie Amodio