Homework and teamwork needed for ‘fixer uppers’

Homework and teamwork needed for ‘fixer uppers’

If you are not yet addicted to tennis, golf or boating, you may be thinking about buying a fixer-upper. Take two aspirin and lie down.

Can’t get the notion out of your head after that? Then you’ll want to contact a real estate agent. The more speculative the investment, the more you need help. The cheapest residence – house or condo – is not necessarily the best investment. You need to find the property with the best value.

Value. This is not just real estate “speak.” Buyers of fixer-uppers need to work the figures backwards. They need to know how much the residence will be worth after the renovation, so they know how much to pay for the renovation. Also crucial: buyers need to know who will live in the house or condo, and for how long. Maybe the buyer is fixing a place for personal use. If the idea is to flip it – that is, to sell it after the renovations have been completed – then the buyer needs to know a lot about the next buyer.

The value after the renovation needs to be compatible with other houses in the neighborhood and, more particularly, other units in a condo. It needs to fit in with what the next buyer expects to find and can afford.