Guide to Buying a Fixer Upper (Part 2)

Click Here To See Part 1: The Diamond In The Rough

Keep Eyes and Ears Open

Guide to Buying a Fixer Upper (Part 2)Upon locating a potential diamond, the next step is to try and disprove its legitimacy. With your eyes and ears, check the house for the tell-tale signs of false promise. Potential problems with the layout and structure of the house are the fastest way to disqualify it from being the perfect choice. The house should be designed to support the way you live, making life more comfortable. If the opposite proves true and the layout hinders daily functioning, there are only so many walls that can be moved to improve the situation.

Structurally, the house should be safe and reliable, operating as a functional place of shelter. For this, the house needs to be level, with limited decay and roof damaged. Water pipes and electrical wires should also be in place and operable, not dislocated or drooping down. With cracks and dips, the floors and walls are the fastest way to unveil an uneven surface. The first to show decay and movement, porches and stairs are also excellent places to check for both a level foundation and stability.

Last, but perhaps the most important thing is to locate all the outlets and check them. While surveying every room for their location, check for water stains. On the walls and ceiling, these stains could imply roof damage. Unfortunately, the only other signs of potentially extensive roof problems are impaired and missing shingles, which can be misleading and don’t necessarily mean the worst.

Invisible Time Bombs

Guide to Buying a Fixer Upper (Part 2)Guide to Buying a Fixer Upper (Part 2)Guide to Buying a Fixer Upper (Part 2)Guide to Buying a Fixer Upper (Part 2)Guide to Buying a Fixer Upper (Part 2)Passing a physical exam, the house may appear great on the surface, but there may still be problems that are invisible to untrained eyes and ears. These problems are some of the biggest deterrents for home buyers and should be uncovered before anything is signed. Asbestos and underground oil tanks are two of the most serious offenders that, although invisible, usually end up costing more money to fix than the investment is worth. Extremely hard to get rid of, mold and termites may also be breaking points for potential houses. However, these two things are usually worth the time. Depending on the amount of damage, fixing these two unseen menaces will heavily increase a home’s original value.

Licensed engineers and the house experts at finding things unseen, home inspectors are a potential buyer’s best friend. The selling broker is only required to present specific information about the house and may even be unaware of any hidden problems. Hiring a home inspector or enrolling in a class on home inspection is really the only sure way to know exactly what you’re paying for. If potentially serious structural or other invisible problems are uncovered, a home inspector’s report can help buyers get a better price on the house. Once a price is reached and the dotted lines are signed, these reports also make good to do lists for future tasks.

Research is the second necessary step in ensuring that no parasites are lurking in your potential diamond. The local building department should have a folder on the house. If they don’t, walk away immediately. If they do, this folder is an essential piece of homework that will reveal any uncommon, but devastating issues that may be connected to the home’s past, such as an underground oil tank from the 40s or a buried drain field. An oil tank graveyard is the fastest way to lose a mortgage. Banks are always very thorough. Just because you’re bad at homework, doesn’t mean they will be.

The Bottom Line

Guide to Buying a Fixer Upper (Part 2)There are always at least two hidden time bombs that come with any home renovation project, time and money. An optimistic goal of three months can turn into three years really fast, even for experienced renovators. This is because fixing a house is a learn as you go endeavor. Bad history and hidden problems are never upfront and in your face. They appear as you find them. The more you find, the more money you spend.

It’s recommended that all buyers add at least 20 percent to their total estimates. Some professionals even advise being prepared for tripling the expected cost of the project. Estimates are necessary for formulating an asking price and should be approached with respect, planning and professionalism. From a home inspectors report, the inspector or a lawyer can help configure potential time and cost requirements. Talking to contractors is another good way to get a second opinion on the estimates.

Once a researched and planned estimate is reached, an offering price is formed by tacking on at least 20 or 30 percent more and then subtracting that amount from the home’s predicted after renovation resale value. The bottom lines on time and money are fluctuating ideas. However, as long as the combined cost of renovations and price is less than the home’s finished worth, consider the project a rescue mission with a diamond at the end.

Taking a course in home inspection may help ensure you fully expect what your new home should entail. Click here to explore this course!

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