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Considering a Fixer-Upper? 15 Ways to Avoid a Money Pit

Money Talks News logo Money Talks News 3/13/2018 Marilyn Lewis

Project popularity: 14 percent remodeled their master bedroom and another 2 percent added to the size of that space. Another 14 percent remodeled a guest bedroom, with 2 percent more adding to its size. Among site users who took on a redecorating project last year, 23 percent said they redecorated a master bedroom, and another 23 percent, a guest bedroom.

Cost details: The reported overall average for a guest bedroom remodel was $1,500; among those adding square footage to the space, costs averaged $11,000. For a master bedroom, the average remodel cost $2,600. Those adding to square footage to the space spent an average $18,300.

2015 plans: 11 percent are buying mattresses and 32 percent, decorative accessories including pillows and bedding. © Hero Images/Getty Images Project popularity: 14 percent remodeled their master bedroom and another 2 percent added to the size of that space. Another 14 percent remodeled a guest bedroom, with 2 percent more adding to its size. Among site users who took on a redecorating project last year, 23 percent said they redecorated a master bedroom, and another 23 percent, a guest bedroom. Cost details: The reported overall average for a guest bedroom remodel was $1,500; among those adding square footage to the space, costs averaged $11,000. For a master bedroom, the average remodel cost $2,600. Those adding to square footage to the space spent an average $18,300. 2015 plans: 11 percent are buying mattresses and 32 percent, decorative accessories including pillows and bedding. Fixer-uppers are back in style.

During the housing boom (prior to the housing crash), few homebuyers wanted to bother with renovation projects. New homes and those in move-in condition were the ideal. That’s still true for many buyers. But others are finding that a well-done remodeling job can save them a lot of money.

Fixer-uppers are getting attention because:

  • Home prices are high in many cities, and a fixer-upper may be the only affordable choice in decent neighborhoods.
  • Home decorating and improvement TV shows inspire many buyers to use remodeling to get a home that’s perfectly suited to them.
  • Lovers of period homes always want to restore older structures.

However, the wrong remodeling project can become a money pit that strips your bank account right down to the studs. Here are 15 ways to identify the fixer-uppers worth your time and money:

1. Make cool calculations

a man and woman cutting a cake: Young African American couple. © Andrey_Popov / Shutterstock.com Young African American couple. Bring an analytical eye when shopping for a home to renovate. Put your emotions in the back seat while you assess each home’s possibilities.

2. Love the floor plan

House drawings © RomanR / Shutterstock.com House drawings Look for a floor plan you can live with. Moving load-bearing walls is an expensive proposition and generally to be avoided. SFGate tells how to identify load-bearing walls.

3. Start with the basement

a close up of a door: Stairs to basement © Annebelphotos / Shutterstock.com Stairs to basement Inspect a home thoroughly, inside and out. Check inside and outside the basement or foundation for exposed wires and pipes, cracks in the foundation or water pooling around the home.

“The biggest problems in a house typically arise as a result of poor stability in the structure or foundation,” contractor Tyson Kunz tells Bankrate.

The National Association of Realtors’ HouseLogic.com offers more details on inspecting foundations.

4. Inspect the roof

a close up of a rock: Roof with moss © Take a shot / Shutterstock.com Roof with moss Get a home inspector or trusted roofing specialist to tell you if the home needs a new roof, which can cost $20,000 to $40,000 and up.

Consumer Reports says:

Runaway water can wreak havoc on any home, and a leaky roof is its quickest way in. If the home has an asphalt roof, look for cracked, curled and missing shingles. Gutters, downspouts and leader pipes should also be in place to collect rainwater and channel it away from the house.

5. Scrutinize bathrooms

a white toilet sitting in a bathroom: Bathroom suite © Simon Annable / Shutterstock.com Bathroom suite Bathrooms deserve special attention because leaks cause rot and structural damage.

6. Avoid ancient plumbing and wiring

Rusty pipe © Tamara Iva / Shutterstock.com Rusty pipe

The presence of these elderly building materials is a sign of trouble:

  • Galvanized steel pipes: Sediment can build up in the pipes, and they may leak and corrode.
  • Aluminum wiring: It’s a potential fire hazard.

Replacing a home’s plumbing and wiring are budget-killers involving thousands — if not tens of thousands — of dollars.

7. Back away from funky smells

a woman posing for a picture: Bad smell © Dean Drobot / Shutterstock.com Bad smell

If your nose wrinkles when you enter a home, that’s a sign of problems. A home that emits bad smells may have a dangerous gas leak, sewer or septic problems, or mold — all of which require expensive remedies. Save your money for improvements you can enjoy.

Musty and dank smells come from mildew or mold. Mold is not always visible and may be inside walls. Don’t assume you won’t find mold in a dry, arid climate. It can be caused by condensation inside walls.

8. Watch for rot

Rotten wood © akoro / Shutterstock.com Rotten wood

Rotting wood is another red flag. Use a pencil to push on trim and the wood around windows, and look for soft or crumbling wood.

9. Inspect drywall and floors

Keep an eye out for flooring or drywall that is:

  • Stained
  • Uneven
  • Warped
  • Discolored
  • Peeling

These can indicate rot or mold.

10. Run from bad siding

a large building in the background: House siding © Provided by MoneyTalksNews House siding Deteriorating siding raises a red flag for two reasons:

  • It’s expensive to replace. Depending on the material you choose, new siding can start at $10,000 to $13,000. Costs increase with the size and complexity of the job.
  • It may indicate other problems. Siding may be rotting, blistering or disintegrating because of rot or mold hiding behind the home’s exterior.

11. Beware leaky windows

a cat sitting in front of a window: Cat at window © Phuong D. Nguyen / Shutterstock.com Cat at window If you want to replace old windows with new, energy-efficient ones, that’s cool.

But be careful of committing to a home with leaking windows. Water seeping into a home through window leaks can cause untold — and unseen — problems from rot and mold. You can’t tell how bad the problems are without removing the windows.

12. Spot a bad location

Become an expert on the neighborhood. Bargain homes are often in less desirable areas. Knock on doors on the street and chat with neighbors about crime. Your job is to assess how bad a neighborhood is and whether it’s really going to turn around.

Even if you don’t have children in school, your home’s next buyer might. So learn about the quality of local schools. Get neighborhood crime statistics from the police. Assess the home’s proximity to jobs, stores, banks, cafes, restaurants and playgrounds.

13. Look for pests

Termites © Chayuth M / Shutterstock.com Termites

You’ll need an expert to tell for sure if a pest infestation is present. But you can spot some telltale signs, including:

  • Insect wings left on sills (a sign of termites)
  • Teeny sawdust piles along baseboards (carpenter ants)
  • Urine stains, odors or scrabbling sounds (rodents)

The legal experts at Nolo.com describe tip-offs to other pests.

14. Hire a home inspector

a man wearing a hat: Plumber © Ozgur Coskun / Shutterstock.com Plumber

Once you’ve found a home that passes muster, hire a well-regarded home inspector to professionally look at the structure from top to bottom. This typically costs a few hundred dollars. Don’t buy a home without a professional inspection.

You can locate inspectors in your area on the website of a national organization like the American Society of Home Inspectors.

Tag along as the inspector tours the home if you can. You’ll learn a lot by seeing it through the inspector’s eyes.

Note: Don’t try to search for lead paint or asbestos. These are dangerous substances, so let the inspector do it.

15. Inspect after a rain

Umbrella © Ugo Calabria / Shutterstock.com Umbrella See if you can schedule your home inspection right after it rains. Visiting at that time lets you and the inspector see if water accumulates around the foundation — a bad sign, as it can cause leaks and foundation problems.

Have you bought a fixer-upper? Tell us about it in the comments below or on our Facebook page.

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