Everyone loves a bargain – especially buyers of real estate.
A smart purchase can set you up for life or give you a fiscal boost that can be the equivalent of a decade spent working in your cubicle. Many great-value properties are “fixer-uppers”, or a “remodeler’s delight”. The price is lower than similar homes in the neighborhood because you need to spend some money to get the building into decent shape.
Now, nobody wants to star in their own “Money Pit” movie (remember the Tom Hanks classic?), so buyers need to be diligent in assessing a property if it requires extensive remodeling.
Existing homes are not blank canvases and can hide ugly and expensive problems. As an experienced real estate agent, I candidly discuss with my clients the challenges of upgrading a property.
By no means do I wish to dissuade anyone from buying a property that needs work, but I think it’s essential buyers understand the size of the challenge.
If you’re looking for a great property that needs serious TLC, or a remodeler’s delight, I’d be happy to discuss options with you and how you can ensure your new home remains a great investment.
Here are ten remodeling tips I share with prospective buyers.
- Create the vision, scope the work – Focus on what you need to do to the property, and whether remodeling can be done in stages. It’s cheaper to get everything done at once, but sometimes the finances don’t work in your favor. I like to see homes as a work in progress.
- Get three realistic quotes – Don’t put your money down before you know how much your desired improvements will cost. Get into the detail of labor and material costs because that’s where you’ll find the demons.
- Keep the budget realistic – Your mortgage will stretch only so far. You may be planning your dream home, but make sure it doesn’t kill you financially. It’s no fun when all you do is pay off the home loan.
- Add an extra 15% – Yes, really. Set aside an additional 15% of the budget for unforeseen problems. If you don’t use it, happy days. But if things go wrong and cost money, you don’t want to be buying groceries with credit cards.
- Decide on the luxuries in advance – Splashing out on fancy faucets or designer lighting is fantastic if they’re in the budget. Avoid making decisions about embellishments as you go because the costs will quickly go north.
- Hire carefully – It’s a brave owner who hires a contractor on price. As a rule, you get what you pay for. Also, decide whether you want to project manage the upgrade. If you’re using an architect, I’d recommend they take on this role (budget allowing).
- Make deadlines your compass – Depending on the scale of the work, ensure your contractor agrees to completing the work in stages and accepting a deadline for each one. This way, you’ll be able to keep track of progress.
- Avoid the chaos – It’s pretty tough to live your life on a construction site. See if you can include alternative rental accommodation in your budget. Work with your project manager to decide when you can expect to move in.
- Keep believing – It’s hard to stay positive during a big remodel. There are always problems, questions and a million decisions to be made even after you’ve prepared diligently. Construction is not a reality TV show, so accept the sailing won’t always be smooth.