Considerations When Buying a "Fixer Upper"
The real estate market continues to be very competitive in Wisconsin. Due to this competition, some buyers are considering buying a “fixer upper” home for a lesser price and then invest in remodeling or upgrades. If you are considering this option, we have some tips for you to consider.
- Bring a contractor along when you tour the home. This will help you determine what repairs might be necessary and approximately what it will cost to repair.
- During the repairs, plan on an alternate living space, if needed. You might not want to end your lease or sell your existing home just yet. If the property needs serious repairs or renovations, you’ll probably need to live off-site until they’re complete.
- You may need an alternative mortgage program. If you want to finance the home purchase and the renovations and repairs the property needs, you might consider loans like the FHA 203(k) loan or the Fannie Mae HomeStyle loan. Your loan officer can help you choose the best option for your purchase.
- Be prepared for problems below the surface. Not all issues will be visible during the initial scope or tour of the property. There may be other problems, some major, lurking below the surface (like mold or termites, for example) that will not initially be seen or known. Make sure that you leave some extra money in your budget to account for these unknown or unexpected expenses.
- There may be appraisal and inspection issues. If the home is in disrepair, you might face challenges with your inspection or appraisal. This is especially true if you’re using an FHA, USDA or VA loan, as properties must meet strict requirements with these programs.
Fixer-uppers are just one of the many options you have when buying a home..
If you are considering purchasing a building that may need repairs or reconstruction, please call SERVPRO of SW Waukesha County and we can help. 262-542-0900.