Buying a fixer-upper can be a great way to get into a home "on the cheap," but too often what seems a sure thing can turn into a disaster. Repainting interior walls may be easy, but foundation repairs, structural alterations, adding square footage, or alleviating a mold problem can be costly.
Depending on what "fixes" are required, even a low asking price may be way too high in terms of time and effort required to make a house desirable. Here are some tips to assure that your dream house doesn't become the money pit you'll regret ever considering.
Know the Neighborhood
There's no substitute for local knowledge. Remember that there's always a reason when a home is underpriced for its area, be it in Eagle River or elsewhere. If it's simply that it hasn't been updated in decades, it might be a good deal. But weigh the pros and cons carefully, and consider local zoning and development trends, in addition to structural condition. Exercise caution and do your due diligence.
Overestimate the Costs
If there's anything sure about renovation, it's that the work will take twice as long as you expect and will cost more than you think. That, in itself, is not a good reason not to proceed; just be sure to give yourself a cushion both in terms of time and dollars. Whether you hire a contractor or plan to complete the bulk of the work yourself, be sure you understand the scope and the time frame. If you need plans and permits, know what's involved before you proceed.
You've probably heard the phrase "Don't overbuild for the neighborhood." That's good advice. Whether you're doing simple cosmetic updates or extensive exterior alteration, let the area's comparable homes be your guide. Add features that will keep its value in line with other similarly updated and maintained homes. Never be tempted to become the biggest, boldest or most expensive house on the block.
Don't Take Shortcuts
Resolve that any changes you make -- from replacing windows to adding a new roof, from smart home technology to new appliances, and from picking new light fixtures to installing granite countertops, will be done properly, professionally, and in compliance with existing codes. Always use the best quality materials that your budget will allow, and lean towards green and sustainable as you make your selections.
Underestimate the Return
Don't let the prospect of selling at a profit cloud your judgment about the choices you make. It's better to underestimate the remodeled value rather than to feel trapped in a home that will take time to appreciate, even if you have no intention of selling it anytime soon.