An excellent strategy for the first-time buyer is to find a bargain and fix it up.
These properties are usually cheaper because they need work, but they allow you to enter the market with a larger property than you might have expected.
It can also prove to be a more valuable investment because of the improvements you make that can pay off in multiples if you intend to own the property for a decade or more.
When the property has “good bones” and isn’t plagued with structural problems then it can be the perfect purchase.
However, remodeling a home is no easy task and requires a lot of diligence. It’s an especially tough assignment if you’ve never owned a property and not experienced the maintenance they require. But if you’re motivated and focused, you’ll nail it.
Below is a list of hints and tips for first-time buyers considering buying a property that needs some TLC in exchange for an attractive price.
Create a budget
Most remodeling projects cost more than you think. What starts as a modest project can quickly escalate, so you’ll need to be disciplined. Experts will also recommend you keep aside 20% of the project’s cost in case of problems.
Advice vs Opinion
Focus on what you want. Friends will offer their ideas and opinions, and architects and contractors will provide advice. Be sure to know the difference. Ultimately, the decisions are on you but weigh up the pros and cons.
Professional help
If you’re embarking on a major project, consider an architect, lighting consultant and independent project manager. They will push the costs higher but can be worth it. Protect yourself from decision fatigue by having experts around you and developing a rapport as when you are tired and worn out is when the worst decisions are made and opportunities missed.
Zero assumptions
Don’t fall into the trap of thinking something will be done without you explicitly asking for it. If you’ve got contractors of varying skills fixing up a bathroom, ask yourself who will put up the towel rails. If you don’t ask someone specifically to do it, then the job will fall back to you.
Can I quote you?
Do not treat estimates as quotes – this is a golden rule. Get each contractor to put their quote in writing and hold them to it. Make sure you’re clear on the inclusions of the quote and what other expenses you may face in the event that you discover something unexpected as part of the work.
License to thrill
It’s always thrilling to see your project materialise, but are your contractors licensed and do they have the appropriate insurance coverage? Insist on sighting these before they come on the site, or you risk getting a surprise of a different kind.
Be patient
If your favorite contractor can’t start work immediately, then be prepared to wait. Any need for speed and going with someone you’re not completely comfortable with for the sake of expediency can cost you dearly down the track.
Staying or going?
A big project is often best served by you not living amongst the rubble and dust. It’s your choice, of course. If you ask your contractors, they’ll want you gone. But that means you’ll need to find and pay for alternative accommodation. Factor this into your budget, or be prepared to stay with the inlaws.