Today we’re talking about the amazing world of fixer-uppers in San Diego, California! I know that some of the buyers out there are feeling this market right; we have low mortgage rates which is great but we also have low inventory so it’s making it super hard for buyers to get into the homes they want so one way around this is to possibly think about purchasing a fixer-upper.
A common thought out there is that you need a lot of cash to purchase a fixer-upper. In some instances that’s true, but not necessarily. It depends what type of fixer you’re looking for.
Are you looking for something that has for example a cracked foundation, or the house is sliding down the hill. Or, are you looking for something that maybe you just need to coax the luster out. There is a range however not every fixer-upper is a good deal and if you’re not cognizant of that, you may end up in a money pit so I’m going to give you the lowdown.
If you’re going to invest in a fixer-upper, where it’s to flip for profit rent it out, living it yourself, whatever the case may be, you’re going to want to make sure you keep these four things in mind
The first I’m sure you’re already guessing, location, yes location, location, location. An example from due to having four-year-old, you can put a diamond in a pile of poo, but you’re still gonna have to walk through the poo to get to the diamond or touch the poo, etc., so essentially there’s no point in putting thousands and thousands of dollars into a house to make it beautiful when basically nobody wants to go there, nobody would want to buy that, house because it’s not an area that’s desirable. If you’re going to buy a fixer-upper, it needs to be in a neighborhood that’s either high demand or up and coming i.e. so in the next five to ten years it will be. That’s also a very um good way to go about it.
The second factor to consider is the floor plan. When you’re checking out a fixer-upper, you want to make sure that the floor plan isn’t clunky or piecemeal together. If the kitchen’s upstairs and the only bathroom is down in the basement, it’s going to take a considerable amount of money to make that work, so that might not be the best investment for you there.
The third is the condition of the property. Like I mentioned, there’s a big difference in a house that just needs to be repainted versus a house that needs new wiring, plumbing, roof, and all of that kind of fun stuff. When you add up some of those bigger costs, sometimes it makes more sense to search for a home with less major fixes.
The fourth is the configuration, essentially number of bedrooms and bathrooms, and it matters. It’s actually the biggest deal deal-breaker for most buyers. A three-bedroom, two-bath house s going to be a smarter investment than purchasing like a two-bedroom, one-bath, or something like that. Obviously everybody’s situation is different, so if you can afford a 2-1 , then start there and move up after earning equity in that home.
If any of these things I just mentioned are an issue, odds are you’re probably better off not investing in that particular house. That’s where I can come in and consult with you. I’m happy to give. you all of the information and resources I have. That way, you have everything you need to make that decision when it comes to purchasing a fixer-upper.
My solution is pretty straightforward. Consider location number one and your budget. Is it feasible? if it is we’ll move on to step two, and if it’s not, we’ll move on to location number two, and we’ll keep going 2down the line until we find the perfect fit. Step two is something I discuss with my clients off camera in private as I don’t want to give away my creative strategies.
You may have some cash saved up for a Reno or you may want to get a loan to cover the cost of the home and Reno, there’s different options such as a 203K FHA, etc.
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