Saturday, June 10, 2017

Money Crashers: How to Buy a Fixer-Upper

As I've noted before, I'm a big fan of home-remodeling shows. One of my current favorites is "Rehab Addict," in which pint-sized powerhouse Nikki Curtis buys up old houses in poor condition—sometimes even ones that have been condemned and are slated for demolition—and "restores them to their former glory." It's great fun to watch the transformation, but what I like best about the show is that it doesn't sugar-coat the process of turning these ugly ducklings into swans. Nikki runs into problems—sometimes really big problems—and you see how she struggles to fix them. There's even one episode where she has a couple of houses that aren't selling, and she's forced to sell her own house just to raise enough capital to keep working. Watching this show, you can definitely tell that fixing up a house is a rewarding job, but not an easy one.

In this way, I think "Rehab Addict" is a good counterbalance to some of the other home shows, which make the process of making over a house look like a lark from beginning to end. Binge-watching a whole bunch of "Fixer Upper" episodes could easily lure a viewer into thinking, "Gee, this doesn't seem so hard! All you have to do is buy a beat-up old house and throw up some shiplap and new tile, and you can make a ton of money!" And in reality, of course, it's almost never that simple.

So in my latest Money Crashers article, I offer a more nuanced look at the pros and cons of buying a fixer-upper. I go into all the nitty-gritty details that the HGTV shows tend to gloss over, such as:
  • Figuring out what repairs a house needs
  • Determining what you can DIY and what you have to hire out
  • Calculating the costs for repairs and permits
  • Financing options that cover both the house and the repair costs
  • Evaluating your own ability to handle a fixer-upper
  • Deciding how much to offer
  • Bargaining with sellers to get a good deal
  • Writing clauses into the contract to protect yourself
If there's a fixer-upper in your future—or you'd like there to be—this is stuff you'll definitely need to know. Get all the details here:  How to Buy a Fixer-Upper House – Save Money & Avoid Risks

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