9 Clues a Fixer-Upper Home Isn’t Worth It
Many people love watching TV shows that feature a full home renovation being completed in just 30 minutes. These shows make it look so easy, it’s tempting to think you could do the same for any cheap home you find on the market. The reality, though, is quite different.
The people behind these shows are professionals who know what to look for in a home. For every success story you see, there are many homes that didn’t make the cut. Are you sure that you have the knowledge and skills you need to spot the winners and losers? It’s hard to say.
If you have the knowledge, skills, and money to fix up a home, it might make sense for you. However, the following clues might show the fixer-upper you’re looking at isn’t worth your time and money.
An Awkward Floor Plan
The current trend is to have open-concept living spaces, but older homes are more likely to have closed-off spaces. If you want to make an old home feel like new, you’ll literally have to change the floor plan. It’s easy to change carpeting or wallpaper, but knocking down walls to create new spaces is much more difficult than it looks on TV.
Sometimes, changing the layout isn’t even possible because those walls are holding up other parts of the home. You want a home that has the right energy flow, and if a fixer-upper home doesn’t have this flow naturally, you may never be able to get it right.
Cosmetic vs. Structural Repairs
When it comes to deciding if a house is worth fixing up, one of the most important factors is what kind of repairs are needed. Cosmetic repairs are generally far cheaper and easier to perform, and can often even be done yourself. However, if the house needs more extensive work, such as plumbing, foundation or roof repairs, this could be a sign that you might end up spending more money on the property than it’s worth.
It’s Over (Or Under) Priced
When looking for a home, compare the price to other houses in the area that are a similar size and have comparable features. If the property you’re looking at is selling for noticeably more money than similar homes in the same area, this can be a bad sign. Likewise, if a home is significantly under-priced, it may look like a good deal but there’s a chance that it could be priced for a quick sale and there may be some issues with it.
It Doesn’t Fit Your Budget
Once you do find a home for the right price, you have to factor the cost of renovations into your decision. Let’s say that your budget is $350,000. If you can buy a home that’s only $250,000, then you have an extra $100,000 for your renovations. That’s probably plenty for you to make the changes you need.
If the asking price on the home is more like $325,000, you don’t have a lot of wiggle room in your budget to make the changes you want. You’d have to carefully do the math and crunch those numbers, using accurate estimates for the work that needs to be done. And don’t forget that there are almost always surprises found during the renovation process. A true fixer-upper home should have a price that reflects the work needing to be done.
The Renovations Won’t Add Value
Even if you’re planning to live in the home rather than flip it, you need to think about renovations that will add to the value of the home. Things like repairing the roof, finishing the floors, and even upgrading the kitchen, will likely be costs you could recoup if you ever sell the home. They increase the home’s value.
Other types of renovations might not make sense. Anything that’s highly stylized, for instance, would be distracting to future potential buyers. In fact, if you were to add a modern kitchen to an older, character home, you might actually decrease the value.
The Location Isn’t Right
You can change a lot of things about a home, but you can’t change its location. A home that’s in a bad neighbourhood will be hard to sell even if you dramatically improve it. Bad neighbourhoods aren’t the only thing you should worry about. For instance, homes in the countryside are less attractive to many people because they aren’t close to the necessary amenities, even though some families prefer the quiet. A beautiful family home becomes less appealing when it’s placed on a busy street, because the kids can’t ride bikes outside.
Before you sink a lot of money into renovating, think about how its location affects the value. You need to have a deep understanding of the local market before you make your move.
Be sure to get accurate estimates when it comes to making repairs or renovations. This is especially true if you won’t be doing the work yourself. Average costs are only averages. The actual cost for the renovations you want to make may be significantly higher than the average cost. You won’t know this until you get a real quote from a professional. Fortunately, most fixer-upper homes take a long time to sell, so the seller is usually able to offer you access to the home for these estimates. Bring a trusted contractor with you to check out the home, see if what you want to do is possible, and give you an estimate – along with some possible worst-case scenarios.
The Inspection Turns Up Additional Problems
You might put an offer on a home thinking it has a few problems you don’t mind fixing. Once you get an inspector into the home, though, they might find several additional problems you weren’t planning on. These might be major issues like damage to the foundation or minor issues like a pipe that needs to be replaced, but you may not want to take on the extra costs.
Remember, once you start renovations, you may find even more problems. If there’s room in your budget for solving the extra problems, go ahead. If the budget is already tight, it’s time to move on.
It’s Far From Being Move-In Ready
Most people need to sell their current home before buying a new one. Once the old home is sold, you’ll have new buyers pressuring you to get out. You might not mind living with a bit of dust for a few months, but major renovations can make it impossible to live in the home until the work is finished. This isn’t a big concern for those who plan to take their time renovating while living in their old home, but if you need to move quickly, it can cause a lot of stress.
Buying a fixer-upper home can be exciting, but they’re also a lot of work, especially for those who don’t have general construction skills. If the changes you want to make to a resale home are mostly cosmetic, you may be able to get a good deal. However, if you’re looking at major changes, it’s usually better to consider buying a brand new home instead of a resale.
Originally published June 4, 2018, updated Nov 17, 2020