Five Things to Look for in a Fixer Upper
Applying for a mortgage is an exciting time and it can be hard not to get swept up by the value that a fixer-upper seems to offer. The characterful windows, the enchanting wooden floors… and the dodgy supporting wall that seems to be held up with chewing gum and good vibes.
Fixer-uppers are often love-at-first-sight, but when the site turns out to be shaky and the roof ran off with Ophelia, sometimes the heartache just isn’t worth it. Other times, however, with the right care, perseverance, a dose of stubbornness, and a keen eye for the bigger picture, a “well-loved” home could be an unbeatable investment.
If you’re wondering how to spot the difference between the two, here are five things you really need to look for in a fixer-upper.
1. Location, Location, Location
There’s an old saying that goes, “Buy the worst house on the best street”. This should be your fixer-upper mantra. Seek out the house that buyers would be clamouring for if it was a sleek turn-key, and look beyond the dodgy carpets and avocado bathroom suite. Assess the neighbourhood in general too. Is it well-maintained and predominantly owner-occupied? You should also note whether there are good schools, decent public transport, and shops or supermarkets nearby. All good signs that your long-term investment is that little bit more secure.
2. Know Your Biggies
There are some things you can optimistically add to your own to-do list when budgeting for the renovations. You can probably do the painting and you’re pretty sure your uncle will help you lay the laminate. These aren’t hugely expensive fixes if you need to call the experts in at a later date to enhance your enthusiastic efforts. But dodgy plumbing, shaky foundations, and fried electrics are not something you can simply add to your mate’s dad’s friend’s to-do list. If you suspect something is wrong with any of the major money-sucks (plumbing, foundations, electrics, waterproofing, windows, heating, roof, etc.) add a worst-case-scenario cost to your budget. Then double it. Because if Grand Designs has taught us anything, it’s that anything that can go wrong, will go wrong.
3. Configuration is Key
Speaking of Grand Designs, before you start dramatically pointing at every second wall throughout the house while exclaiming, “That’s gotta go!”, you might want to do a little market research first. The configuration of a house - the amount of bedrooms, bathrooms, living space, etc. - is the first thing people look at when purchasing. If this is your forever home, then go tear-down happy. But if you’re planning to resell down the line, you might find that buyers are looking for a three-bed house, not an open plan two-storey studio. Appealing to the largest pool of potential buyers is a more market-proof way of upselling later.
4. The Seal of (Expert) Approval
When buying a fixer-upper you’re going to get a lot of enthusiastic opinions from well-meaning friends and family. By all means, hear them out on the modernising power of a cloud-grey accent wall. But before you start buying colour swatches, call in the experts. Getting a survey done on the property may seem like a costly move before you’ve even placed a bid. But if they spot rising damp, damaged sewer pipes, or fire-hazard wiring, that few hundred bucks could well save you thousands down the line.
5. The Cold Hard Figures
This is possibly the only straightforward part of investing in a fixer-upper. The simple, sometimes agonising, formula; add the worst-case-scenario cost of the renovations needed, including your own man hours, to the purchase price. Is it more or less of the value of the asking price for something similar? If it’s more, it might be time to kick that heartbreaker to the curb.
Looking for a Fixer-Upper?
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Allied Irish Banks, p.l.c. is an authorised agent and servicer of AIB Mortgage Bank in relation to the origination and servicing of mortgage loans and mortgages. Allied Irish Banks, p.l.c. and AIB Mortgage Bank are regulated by the Central Bank of Ireland. Copyright Allied Irish Banks, p.l.c. 1995.