While you might be looking for a fixer-upper, you want to make sure you’re not purchasing a money pit. But how do you know whether your new-found renovation project is worth it in the long run?
Tip 1: Make sure the house is structurally sound
One of the most expensive parts of a house to repair or replace is its structure. Make sure you get a professional building inspection of a property you’re considering purchasing if you’re concerned the building isn’t structurally sound. Being confident in the structure is worth the small expenditure for a building inspection report.
Tip 2: Consider the floor plan
Older homes can have inefficient layouts that can make it more difficult to work with. Some of the limitations poor floor plans can include are boxed-in rooms and pools that take up the entire backyard. While you may be able to change the layout of the home, you’ll need to make sure doing so won’t affect the foundation of the home and that they can be affordably updated. In the long-run, knocking out an interior wall that supports the roof is probably going to put your budget out!
Tip 3: Check "the big three"
"The big three" refers to the three main rooms you’ll want to update first and are usually the rooms you’ll be using the most – the kitchen, bathroom and living room. These rooms are also the spaces that will fetch you more money if you’re planning on flipping the house and selling it for a profit. Hunt around for competitive pricing on materials and consider investing most of your budget and focus on these three rooms first.
Tip 4: Don’t overestimate your abilities
Renovating a fixer-upper to transform it into your dream home is exciting, but it’s important not to get too carried away. Renovating a home isn’t easy so start small and work your way up to larger scale renovations. If this is your first time flipping a property, keep your eye on the property market for homes that don't require major work and understand when to call in the experts to do those jobs that are beyond your skillset. The last thing you would want to do is create more work that will need more money to fix!
Tip 5: Don’t over capitalise if you’re planning to sell.
If you’re planning on renovating the home and selling it for a profit shortly after, make sure you don’t over capitalise. When renovating for the purpose of profit, make sure you stick to a budget that’s manageable. Staying within your limits and making practical decisions over emotional ones will limit your overspending and allow you to keep a lid on the spending. Keep reminding yourself "is this the forever home? or the temporary home"