Does it Have Good Bones?
I would say that the majority of Buyers gravitate towards properties that are turn key. They will often start of their search saying that they don’t mind a place that needs a little work. This being particularly true for first time Buyers. More often than not Buyers will end up choosing a place that has newer flooring, paint, trim, fixtures and so on. Which is totally fine, it’s their life and their money. That said, I do like to help people try to figure out how to get better deals for themselves.
I have seen a pretty consistent pattern over the years. As a rule, a Buyer can get a nicer property for less money by choosing a home that has good bones that needs some fairly minor updating and doing some fairly straightforward renovations to it.
This is no great secret. I knew this very early on in my real estate career and the majority of Sellers understand the value of a few licks of paint at very least. The thing that I think Buyers need to be aware of is that quite often the upgrades/renos are done with selling the property in mind. Therefore the work done at that stage is generally not done with the idea of making it last. Cheaper materials and perhaps a quicker DYI job than one would do when keeping the home is common.
An experienced eye, like that of a Builder, Inspector, or (most) Realtors can spot the difference quite quickly but I think that most Buyers are wooed by the feeling of shiny and new even after having the above pointed out to them. If they are happy, then great, then so am I. I do get a certain satisfaction from knowing my clients have gotten a good deal. Part of that involves having my Buyers understand that they are likely to have to pay more for the shiny and new loking property than they would have to pay if they had some of the work done professionally and done some of the easier parts themselves.
Not everyone is handy. Not everyone has the nerve to buy something as expensive as a home and then take the risk of making changes that aren’t done right or just having to live uncomfortably while they or someone else does the work under a budget that is not quite predictable. So here are some points to consider if you are wanting to get a nicer home for a bit less and are open to doing a little work on the property to shine up that diamond in the rough.
Does it have good bones? When I walk into an older home that hasn’t had any updates since… ever, I don’t sigh about the ugly decor. Yes, it’s funny that shag carpets, fake wood paneling and naugahyde were once so “nice” and now they’re not, but what I’m most interested in is the structural properties of the house. The bones are the expensive fixes. Foundation, studs, joists, trusses and anything else strucural is the most expensive/difficult to fix in most cases and things like paint and trim are the least. Flooring is somewhere in the middle but if you make a good choice on the product and the installation it will be neither dated or short lived. That’s not money down the tubes, that’s an investment in your biggest asset, your home.
Keep some money on reserve and have a plan. Quotes have a way of being ballpark for a best case scenario. I’m a fan of financially planning with slightly pessimistic numbers so that any surprises are likely to be good surprises rather than bad ones.
How handy are you? I mean, really? I’ve seen so much DIY that has caused long term issues with properties. In many cases people end up costing themselves money in the long term because they tried to do things the cheap and fast way rather than biting the bullet and doing it right. (I see the same issue when selling the home too. More on that here.) Most work around the home is not complicated but if the details aren’t done right it can cause other issues. The worst in our area being issues that have to do with water ingress. If you decide to do some work yourself to make it cheaper, then by all means do so. Just be honest with yourself about what you can do on your own, with the guidance of a more experienced friend or simply leave to the pros
Be able to visualize change. The aforementioned shag carpet and fake wood paneling aren’t a big deal to change. Paint on a house is akin to makeup on a lady. If you can visualize how the home will look with these things done, a task that is harder than it sounds, you are likely to be able to see potential other Buyers can’t. The same can be said about being able to visualize the home with decor that is different from what the Seller has. Chances are you will like the stuff you choose much better!
Know your limits. Financially, physically, emotionally and timewise.
Balance these concepts and keep them in mind when looking at properties and you’re likely to find better opportunities. And if you want the idea in an easy to remember phrase, think “Does it have good bones?”
*Golden tip: For those of you who are not familiar with the concept of “mortgage plus improvements” I suggest you contact your Mortgage Broker and ask how you can get those renos done without having to put it on things like credit cards. You can tag it on to your mortgage as it adds value to your home after all. It’s really worth learning about even if you don’t use it.