Am I ready for a Fixer-Upper?
“Fixer-Upper”, “Good Bones”, “Property Brothers” – just a few of the TV shows that have hit the HGTV world by storm and made many potential homeowners start asking the question, “Am I ready for a Fixer-Upper?” I’ve posed the question to local REALTORS® and veteran ‘flippers’ and they have some very valuable advice.
Ok, it may seem like common sense – don’t get started on a project unless you know what it is going to cost. With a flip/fixer-upper, you need to investigate several things in order to get a decent estimate on the bottom line. You also need to consider the fact that in many cases, surprises will occur.
This list is not exhaustive but you should be looking at cost for hvac, appliances, mold remediation, windows, roof repair, flooring, drywall, and paint.
Additionally, many of our experts pressed the importance of contacting local code enforcement officials to verify that there are no repair orders/demo orders/unpaid liens or penalties. You can also work with a reputable title agency to verify a lot of this information.
Loans and financing are available to help with some of the upfront cost of a flip, but keep your goals in mind in terms of profit and equity at the end of the process.
How long might a flip take? Well, there are many factors involved. Are you going to complete the work yourself? Are you going to live in the home as you renovate? What is the extent of the renovation work? Will you have to wait on materials to be shipped or do you have them on hand? Most of our experts say you should anticipate a flip to take a year or more, especially if you are going to be handling some of the renovation projects yourself.
Are you planning to flip and resell? If so, get the lay of the land. Experts say you should investigate the neighborhood, and determine if any other rehabbers are working that area. Competition might not ultimately deter you, but it is definitely something of which to be aware. Also, is the location ideal for resale?
REALTORS® are a great resource when it comes to determining a great location and what will increase your home’s value, giving you the best possible return on investment. Current trends? Best quality material to use? Hot neighborhoods! Do your research and get advice!
Overall, the advice from our experts and fixer-upper veterans, maintains a common theme. Research and preparation. Home renovation in many cases is not the way HGTV portrays it. But that doesn’t mean it can’t be a rewarding and/or lucrative experience!
Other IMPORTANT anecdotal advice to consider:
Do you have a marriage counselor on retainer? (Hint, hint, this can be a stressful process!)
You're only ready if Chip and Joanna Gains are coming to help! (But really, if you don’t want to, or don't have the skill set to do the work yourself, but are still interested in doing a flip – make sure you budget for supplies and labor costs.)
Huge thanks to my contributors: REALTORS®/MIBOR Members: Becky Blossom, Laura Buckner Groenert, Mark Groff, Lee Smith, Julie Downey and Michael Partin. Experienced/experts in fixer-upper projects: Annette Cousert, Kristin Settle, Maura Hoff, Libby Moore and Emma Rogers!