Fixer-uppers can seem like a great way to get the home you want, especially if you watch a lot of home remodeling shows. But the reality is a lot less glamorous than how it appears on TV. That’s not to say buying a fixer-upper isn’t the right choice, but you need to go in with a healthy budget and a lot of patience.
“The one thing I’d caution most people, if you are getting your excitement or advice from HGTV shows, the cost will be much higher than what is quoted on these shows you see,” said Walter Perschbacher, vice president at Greenridge Realty. “Regionally speaking, our cost of materials are up, and if you are going to hire someone, labor costs are higher in West Michigan than other places.”
The timeline also will likely be much longer than what you see on TV, and you should always expect that delays will happen. Santiago Gomez, realtor/broker at Santiago Properties, and his team has been involved in a handful of flips, and he said he always plans for a 12-month timeframe even though most of the work can typically be done in 3-6 months. “Because there will be delays or things can come up,” he said.
Kristy Hawkins, director of operations/realtor at Santiago Properties, said being organized is key to getting the work done closer to the quoted timeline. “For us, what we needed was some kind of program to move things along, keeping track of the money, organizing contractors — if you’ve done any kind of improvement — you want the flooring in after you’ve painted (for instance), or there are more headaches. Check off the plumbers, electricians, flooring, painters and make sure they are coming in at the correct times.”
Both Perschbacher and Hawkins said if you plan to hire a contractor you also should be aware of the current market.
“Right now, we have the same situation in the contractor market that we have in the real estate market in that the demand way outstrips the supply,” Perschbacher said. “Even getting contractors to do quotes right now can be tricky.”
Hawkins said that is because the last recession caused a lot of builders to close and a lot of tradespeople to leave the industry or to relocate to other cities with better construction markets.
“We are so short-staffed on tradespeople,” she said. “We lost a lot of people during the recession due to lack of jobs, and they haven’t come back.”
At the same time, homes that don’t need extensive updates can be a great option to eventually turning your so-so purchase into your dream home.
Perschbacher said he sometimes sees first-time homebuyers get scared off by projects that are very doable. “They can get scared off really quickly by something that really can be done pretty easily with paint, carpet, countertops, which aren’t huge re-dos,” he said.
He added, “With the right location, layout and footage, there is opportunity there.”