Houston Foreclosure Info
Calculating Fix-Up Costs
These are two advantages to buying a house that needs some fix-up. the first is: you can save some money on the cost of the house. The second is: you can have the color of carpet and paint that you prefer.
For instance, if you find a home that you determine the fair market value is a $100,000, but you can buy it for $80,000 because it needs some TLC (tender loving care), you really save more than $20,000. If you put 5% down and take a 30 year mortgage for 30 years on a $80,000 purchase price, the payments are $557.66. If you paid $100,000 for the house, the payments would be $697.08. This is a savings of $139.42 per month, or $1,673 per year. This adds up to $50,189.88 over the life of a 30 year mortgage.
If you think about this, most families will have to paint, carpet and change their wallpaper every five years or so anyway, even if they bought a brand new house from a builder.
It is important if you are looking at fixer-uppers to be able to figure the cost of fixing them up. You will want to take a trip over to Home Dept, Builder's Square or Lowe's and become familiar with the cost of paint, tile, lumber, etc. Pick up some free literature while you are there. Take a small notebook and jot down some prices. visit a carpet store. Make some notes on prices.
There are many sites on the web to help you figure the costs of renovating a house. When you find a house you are interested in, you can go to the Home Depot site and fine calculators to figure the cost of paint, carpet, tile, wallpaper, grass seed, etc. You put in your room sizes and the calculator will tell you how many gallons of paint you need for the room. Or how many square yards of carpet each room needs. Take a look at their site: Home Depo.
There are some very good "how to" articles on the Low's site. For instance, there is one called "Give Your Kitchen a Facelift" that tells you how to refinish kitchen cabinets and add new hardware and end up with a totally new looking kitchen. Take a look at the Lowe's site.
If you think you might be hiring some contractors, check out the Texas Took Box site. They have a list of local contractors, plus many "do-it-yourself" type articles.
If you are hiring contractors it is important to check references and to get at least three bids on all work. Try to get referrals from co-workers, friends or relatives that have had work done on their houses.
If you are looking at fixer-uppers you need to do your homework on calculating your costs of repairs. It is not hard to learn to figure these costs. Here are some more sites to help you with that project: