7 Things You Should Consider Before Buying a Fixer Upper in New Jersey
The real estate market is one that can change quickly. Therefore, learning and staying ahead of others looking to buy similar properties can create an edge. In New York City, home prices grew between 12 and 15 percent, yet average price growth is around 5 to 10 percent per year. The New Jersey housing market tends to follow similar patterns. Furthermore, although many statistics indicate that millennials are not looking to purchase homes, homeownership among the age group is rising. These statistics, along to the fact that home inventory is low, is keeping up the price of homes, thus suggesting that purchasing a fixer-upper is a great alternative for those looking for better deals. However, before purchasing the property, here are a few things to consider.
Analysis and budget
Although a property that needs fixing can be a great choice, prospective renovators need to be realistic about their abilities to engage in the repairs. It is one thing to purchase a home that one person considers ugly and in need of remodeling, and quite another when a fixer-upper has structural problems that require an investment to make the home livable. This is something that the future homeowner needs to know prior to purchasing the property.
The budget for the purchase should include the price of the home and any immediate work that the property requires. As you visit properties, make a list of each item that needs maintenance, repair, or replacement. Add these up and include them in the total cost of ownership when comparing several properties. Always try to account for the fact that most situations will go over budget. According to a study by Houzz, the average first-time homeowner will spend about $34,000 on home renovations. Once you have the list of desired changes, shop around and visit specialists such as the home design center in Morristown, NJ to obtain the best deals.
Location and structure
Purchasing the ugliest home in the best block is a great way to invest. A poorly designed but well-situated property can be adjusted and improved. However, a beautifully designed and structured home in a badly located section of town cannot. Therefore, location is a major part of a purchasing decision. Avoid homes next to a school, on a busy intersection, or in areas that are not desirable. Instead, look for sectors that others see as desirable surrounded by homes that are well-maintained. Focus on attractive structures, such as three-bedroom properties with more than one bathroom that you can renovate but won’t require mayor overhaul. Kitchen and bathroom remodeling can increase the value of the home, so focus on these areas.
Keep in mind that moving walls is difficult and expensive. Although it can be done, avoid having to make dramatic changes that will increase the complexity and expenses of a renovation. Look for homes with a great flow and layout. When searching for properties, consider what changes are easy and which are difficult. For example, wall patch work, replacing carpet, replacing doors, painting, and adding new light fixtures are relatively simple tasks. However, fixing foundation problems, replacing sewer lines, performing a roof repair, and pouring concrete are more difficult tasks that can add up quickly.
Air conditioning and heating
Replacing a heating, ventilation, and air conditioning (HVAC) system is expensive. Therefore, consider getting the home inspected with the inclusion of checking major appliances and systems. Look for HVAC services in New Jersey that can provide additional services such as preventative maintenance and cover other areas like plumbing. Although inspections are optional, the cost of hiring a professional is minor compared to the cost of having to replace expensive units. Weigh the options of repairing or replacing, and keep in mind that upgrading the unit can increase the value of the property.
If the unit is newer and energy efficient, repairing may be a better and more economical alternative. However, repairs will not add value. Additionally, if the unit is older and is not an efficient device, the extra cost of electricity and repairs will eventually be higher than replacing the system. If deciding to replace, look for HVACs that control indoor humidity and invest in a product that includes two-stage equipment for maximum efficiency. These modulating systems reduce temperature swings while increasing operational efficacy, creating a comfortable home.
Swimming pool and accessories
Some people envision the home of their dreams to include a swimming pool. These have value and provide entertainment and comfort. However, before purchasing a home with a pool, make sure to protect your investment. Have the backyard swimming pool professionally inspected so that you are aware of the condition of the equipment. Because these items can have complicated components such as pumps, filtration systems, and heaters, general home inspectors may not be detailed enough to provide a proper and complete evaluation. So instead, you may elect to hire a swimming pool contractor that specializes in the specific structure.
Garden and exterior
When purchasing a fixer-upper, curb appeal may not be central to the buying decision. Mostly, this is used when selling a home to attract potential buyers. Nevertheless, the garden and the exterior can provide buyers with some insight as to how the property is maintained. If the home’s outer part is not well kept, chances are, the interior follows suit. However, the idea is to purchase a home as a project, so the focus on the potential of the outside. Basic garden care is easy to achieve, so look at the spaces where you would like to plant a garden or improve the landscape.
Lead and asbestos problems
Two materials that were popular in residential applications for decades are lead and asbestos. Paint manufacturers before 1978 used the material, but it was later found to be a neurotoxic metal harmful to children. Water pipes installed before the 1980s also used lead. Asbestos, linked to some forms of cancer and respiratory problems, was used for insulation and fireproofing until the middle of the 1970s. Although the Environmental Protection Agency (EPA) banned asbestos a decade later, building owners did not have to remove the products containing the components. If looking at homes that were built before the 1980s, make sure to avoid these materials.
Removing them professionally will add to the cost of the home, but leaving the material adds an unnecessary health risk.
Finally, consider the type of insurance that you will need based on the location of the property. All homes in the state are required to hold insurance, and the price of said policies will vary depending on the needs and coverages. As homeowners learned with Superstorm Sandy, homeowners insurance in New Jersey is critical to protecting property owners from possible wind and water damage. However, flood insurance is not necessarily covered with all policies. Therefore, make sure to ask about this type of protection.
All policies, however, cover the home’s structure and other areas including detached garages and sheds. Furthermore, the insurance will cover the owner’s belonging and can provide protection for other incidents including theft and personal liability. Homeowners can also purchase additional coverage as needed.