Thoughts on purchasing a "fixer upper" house

[stapuff]

My brother and I want to go in on a house together, but we work in two different parts of the city. The area in the middle fair to both of us for commute times is a richer neighborhood compared to where we were looking before. There is a house for sale that needs quite a bit of work. We are both single, have no other obligations besides work, so I think it would be a great investment, and us being quite handy can fix the place up over a few years.

Heres some pics

the front seems ok, windows probably need replacing, roof needs checking out


decent foyer area, all walls need painting, carpet needs replacing, ceiling might need repaint but is probably ok


again, crappy carpet, and the walls could use some color


carpet again


fireplace seems ok, carpet once again, windows questionnable



another view of same room


dining area, washer/dryer need to be relocated to return area to pantry


kitchen needs new appliances, new cabinets or resurfacing, counter might be ok but a newer corian/granite would resell much better


cheesy cabinets with way too much repainting done to them


these pictures really dont do the place justice as to how much work it needs, but a fresh coat of paint with a more appealing color than off white and updated light fixtures would freshen the rooms up


the basement is the crown jewel to this place. What isnt seen is the "freak out" room off to the right with black lights and a funky hole in the wall. Many many drugs were done at this place. The basement would need the most work out of the whole house. The ceiling grid could use replacement too, and missing tiles with water damage make me very queasy about the drain pipe help but I could repair it.... even though it is cast iron


the coolest part of the house is the rear entry garage with a shitload of room for a workshop along with 2 cars.

The house needs tons and tons of work but hopefully we can get the offer down to somewhere in our means and get to work


any words of advice, warning, hope concerning buying a true fixer upper? horror stories?

if we get the place I will try to keep you updated and let you know our progress. Everything else in the neighborhood sells for 30% more than the cost of this place. Will countless hours and dollars poured into this place be worth it? I think so

[blue_monk]

Have you ever seen that show called "flip-it"?

God I love that show. I would like to do this one day. I think it would be a lot of fun. The only thing you need to keep in mind is your networking. If you are planning to do everything yourself no problem, but you might find you need an expert. How will you get people out there? The idea is to buy and sell it as soon as possible so you don't get stuck paying bills for it for months or even years. Do some research and see what the other houses in the area are going for. Set a budget. It is very hard to not go past budget if this is your first flip-it. You never know what you can find. You might have to completely redue the foundation or something major. You just don't know until you look under the walls and house and really see whats behind the face. Looks like it can be profitable, could also be a big headache. How much are they asking for the house? What state? How close to a major city? Sometimes people mess up and go way overboard on the kitchen appliances which make the kitchen a little too upscale for the surrounding houses, which can turn out to be a waste of money. Research.

[stapuff]

Originally Posted by blue_monk

Have you ever seen that show called "flip-it"?

God I love that show. I would like to do this one day. I think it would be a lot of fun. The only thing you need to keep in mind is your networking. If you are planning to do everything yourself no problem, but you might find you need an expert. How will you get people out there? The idea is to buy and sell it as soon as possible so you don't get stuck paying bills for it for months or even years. Do some research and see what the other houses in the area are going for. Set a budget. It is very hard to not go past budget if this is your first flip-it. You never know what you can find. You might have to completely redue the foundation or something major. You just don't know until you look under the walls and house and really see whats behind the face. Looks like it can be profitable, could also be a big headache. How much are they asking for the house? What state? How close to a major city? Sometimes people mess up and go way overboard on the kitchen appliances which make the kitchen a little too upscale for the surrounding houses, which can turn out to be a waste of money. Research.

we're going to be living in the place during the work so we're still considering it better than paying some schmuck rent. The house is north of atlanta, ga. The only people I'm planning on hiring will be carpet layers and roofers because those jobs suck ass. I can do plumbing, electrical, carpentry, painting, etc fine, but I'll leave the carpet and the roof to the pros

the surrounding neighborhood is quite upscale. maybe not all stainless steel shit with a 6 burner gas stove and sub zero fridge, but a nice granite countertop with contemporatry appliances would do well.

we will get the place inspected before we buy for any serious shit like foundation problems.. I will update you soon

[mathlete]

Seems like a pretty good bet, assuming the inspection comes back okay. It looks in pretty good condition actually.

[ceejamon]

Most of the things you've mentioned are practically cosmetic. Replacing carpet, painting, refinishing cabinets, changing appliances... shit, I did all those things in the house I bought and they didn't even "need" it. It was just me making the house my own.

Get it inspected: wiring, plumbing, heat/AC, roof, foundation, etc. Those are the things you don't want problems with. If all those are fine, it seems like a nice house.

[w00t1337]

I don't see how the problems in that house would take years to fix.


Like said, get it inspected, fix it up, and get the fuck out as quickly as possible

[WickedAngel]

Originally Posted by ceejamon

Most of the things you've mentioned are practically cosmetic. Replacing carpet, painting, refinishing cabinets, changing appliances... shit, I did all those things in the house I bought and they didn't even "need" it. It was just me making the house my own.

Get it inspected: wiring, plumbing, heat/AC, roof, foundation, etc. Those are the things you don't want problems with. If all those are fine, it seems like a nice house.

All this, plus you need to make some observations of your finances in regards to holding costs and property taxes. Holding that place for a few years is going to cost some money...likely more than you stand to profit in the long run.

Flipping is a good investment but it isn't a "Jump In!" hobby. You really need to do some research or you run the risk of really fucking yourself hard.

For starters, you need to get info on the market value of similar properties in the area (Realtor). If you can buy it at 35~45% (Completely subjective, but these are the standards I usually work with) below market value, you stand to make some real money when you renovate.

Just off hand, I'd say those minor cosmetics (Wall-to-wall carpeting, interior painting/cleaning, window washing, and perhaps some other alterations) and landscaping would help that property significantly. On top of that, that kitchen is pretty barren and would definately improve the value of the house if renovated.

You don't want to over-renovate though. Making a house worth a million dollars doesn't mean shit if it's stuck amidst a bunch of $250,000 homes, you know?

The neighborhood status and closeness to things like schools/parks will also play a role in how long the house stays on the market.

[mathlete]

It's not a flip guys. I wouldn't advise anyone without experience getting into flipping houses.

[ieyeasu]

Originally Posted by mathlete

It's not a flip guys. I wouldn't advise anyone without experience getting into flipping houses.

lol, paradox : (

[illig]

That doesn't look like a fixer upper. It's just an older house.
I'm surprised that it's 30% below market value since much of the repairs you mention are typically done anyway when moving into an older home.

[Othersider]

Good god; that's a fixer?

The place I'm in negotiations for right now makes that thing look like the fuckin' Taj Mahal.

[Heathen-Yak]

Hmm if you plan to do granite get the cabinets checked out first. tile and granite have special requirements to not squash your cabinets.

[blue_monk]

dude, screw living there. flip it!

[WickedAngel]

Originally Posted by Othersider

Good god; that's a fixer?

The place I'm in negotiations for right now makes that thing look like the fuckin' Taj Mahal.

Most peoples' first flip is usually an easy-to-fix distressed property. As you know, it doesn't have to be in complete shambles before renovation to turn profit.

[homer1300]

that doesn't seem that bad. don't flip it. just own it, and improve it when you have time. you're going to get a return on your investment and you won't be throwing rent money down the hole. i think you had some good ideas. paint in a few places, carpet, kitchen basement.