Homes are becoming ever more expensive in the US. It’s estimated that prices of homes this year have risen by a staggering 13% compared to last year. This means that the average $350,000 home from last year now costs an insurmountable $400,000 this year.
This is without the additional bidding cost, which can drive home prices by five to ten percent. The rising costs of materials, the lack of manpower, and the increased land prices are also contributing to this rise in prices.
There is now a trend among Americans to buy fixer-uppers instead of brand new homes to avoid the ridiculous price tags that many homes have this year. There are two main advantages to this. The first advantage is that fixer-uppers cost way less than the average house in the real estate market. A fixer-upper home can cost $100,000 less than the average home because it needs more work put into it. If you take into account the bidding process, you can get an additional $20,000 to $50,000 taken off from the base price.
The second advantage to purchasing fixer-uppers is that you can redesign and renovate the home with the excess money you have from purchasing it. It’s a gradual and continuous process, but one that many Americans don’t mind because at least they’re not spending $400,000 to $500,000 on a home this year. If you’re planning to purchase a fixer-upper this year, here are some ways you can turn it into your dream home.
Planning Your Costs
Financial planning is an important aspect of any major renovation. However, you can’t handle most of this financial planning alone, especially if you have no experience doing it. This is why you’re going to need a professional certified in financial planning to plan your expenses and costs for your renovation. This professional will help you predict whether if the planned renovation can exceed your given budget. They can also help you contact the necessary people involved for small-time loans that you might need for your renovation. Loans that are short with a small interest rate are ideal.
Hire a Home Inspector
Before you purchase your fixer-upper, you should first hire a home inspector to check the place. A home inspector can be a good consultant when it comes to the price of the renovation and whether if it’s worth purchasing the home or not. Furthermore, they can help you look into common problems that fixer-upper homes have, such as termites, asbestos, and more. Hiring a home inspector is well worth the price because it streamlines the renovation process.
Start with the Essentials
When renovating your fixer-upper, you must start with the essentials. Don’t go into the extensions that you want to have in your dream home just yet. The essentials will ensure that you can get into that later down the line.
The essentials for every home are the tiling, sidings, roof, and paint of your home. This can cost you a decent amount of money, especially if you’re planning to put everything you want in your perceived dream home. But this makes your fixer-upper habitable while also letting you concentrate on the more luxurious part of the process, such as the master bedroom, bathrooms, and more.
Get a Reliable Contractor
You can actually do the essentials yourself if you have the time and money for it. However, getting a reliable contractor to do this job for you can certainly expedite the process. Furthermore, you can also hire them to do the future extensions you have for your dream home in the future. This can all be for a discounted price since you’re purchasing their services in bulk.
Get a Building Permit
Once you have planned out the extensions of your home, it’s time for you to get a building permit for them. Building permits depend highly on the state. Some states require building permits for patios and such, while some states don’t. Do your research regarding which extensions require a building permit in your state so that you can expedite the process.
Turning your fixer-upper into your dream home requires a considerable amount of time. Don’t rush it! Doing small projects will get you to your dream home in no time. It will also ensure that you don’t make a big loan and regret it later in the process. So take it one step at a time to reduce and manage costs for your renovation.
Purchasing a fixer-upper and turning it into your dream home is becoming a good strategy among many home buyers. This ensures that you don’t spend too much when purchasing your home while also tailoring it to something you’ve always wanted. It’s a cheap and worthwhile strategy and something you should consider while market prices for homes are way too high.