凶宅、地基风险、屋旁高压线……买二手房避坑经验

作者：来自月球的晒晒君

我在美国麻州，差点买到凶宅！

@HWHW 在麻州看了很久的房子，终于找到了一间心仪的。就在要签合同前，律师来电话，说已经开始和卖家律师沟通内容，不过有一些需要让买家先知道的内容。买家律师在合同内发现一段额外增加的文字如下：

合约原文为：「房屋内五任何有害物质」
新增内容为：「房屋内无任何有害物质，如果有，也已经全部清理干净」

买家律师认为这段话很奇怪，最后跟卖方律师确认情况：原来屋主一直把房子作为出租公寓，前一个租客是名校化学系学生，前阵子想不开在房内自杀，而且用了「cyanide氰化物」剧毒气体自杀。所以屋主请清洁公司做了清洁，换了地板，也重新上了油漆，最后也请认证公司验证房屋内完全没有有害物质。

但是知道这个结果，应该很少有人愿意继续买这样的房子，所以用户@HWHW 也成功拒绝购买，并被退回了定金。

看二手房经验总结：

看房时要问屋主为何要卖房？屋主为何不继续居住？有没有人在房屋内自杀或他杀？
麻州法律是卖方不用主动揭露是否有人在屋内自杀或他杀，但是如果买方问了就要如实回答。
买公寓类最好先确认自住比例，建议买建house or condo，户数越少越好。

湾区交房前最后一刻，发现有地基下沉风险！

@Flyhomes飞飞前几月在湾区看上了一个外观超级漂亮的独栋屋，内部也进行了全面翻修，都准备下单了，但是在最后读房屋检查报告的时候，幸好他们的中介机灵，帮他们发现房屋居然有地基问题，有潜在下沉的风险！

中介找专业的房屋结构工程师对房屋进行了实地检查，发现下沉风险的根源是房子所在的土地土质比较松软，而且工程师给出了专业的预判：就算修复了地基，治标不治本，长久来看，可能还是会再次发生下沉的问题。地基不稳，修复起来不仅麻烦，而且花费动辄上万元。最后中介帮他们及时止损了。

看二手房经验总结：

湾区多数卖家会提供房屋检查报告，很少情况需要自己预约房屋检查。好好研读房屋检查报告是重中之重。
房屋报告一般都有几十页，充满了难懂的专业词汇。所以建议先找专业的团队或者懂行的朋友帮你先把报告看一遍，挑出其中需要注意的重点信息。
真正专业的中介都会有自己的合作房屋检查团队，能帮买家在下offer之前就做好房屋检查，不需要等很久。
做好房屋检查，除了可以避免房屋较严重的结构性问题之外，还可以利用房屋检查结果作为筹码来和卖家讲价，也可以要求卖家进行维修。

高压线旁的房子到底能不能买？

湾区买房有很多坑：垃圾场、高压线、superfund、地震带、洪水区……高压线真的无处不在，那买房离高压线比较近，到底行不行？@GigiJingyaJi 分享自己一个朋友的亲身经历。

朋友刚来湾区买了一套后院在高压线旁的single house，价格不错，房子没毛病，学区也好。就是对这个高压线耿耿于怀。因为家中有小孩，老担心高压线会对家人健康有危害。这么战战兢兢住了一年，总说自己头疼，小孩莫名其妙流鼻血，最后朋友还是把房子脱手了。卖房子时也经历了些坎坷，都怪在“高压线没人敢住”这件事上。

@GigiJingyaJi 通过几个方面给大家带来一些高压线附近买房的参考。

高压线有辐射吗？是有的。高压线的electromagnetic fields 电磁场，简称EMFs，是会影响人体健康的。它是否会造成癌症、疾病、不孕不育、失眠、情绪波动、头疼，这个的确是众说纷纭，至今都没有一个官方定义。
房子与高压线距离怎么测量？标准是多少？强高压线最好保持200m的距离。不同的高压电自带的EMFs肯定是不同的，距离也会影响，所以需要测量才知道准确参数。
高压线是否会影响房价？答案是肯定的。高压线会影响resale的价格。根据网上的数据，高压线可能会降低房屋价值45%甚至更多。具体影响多少，还要根据房屋状况和卖房情况。
湾区高压线分布图，下图是湾区总分布图，大家可以放大查看，也可以进网址：https://ww2.energy.ca.gov/maps/reliability/LRA_Enlargement_Area.pdf

老房子的节能问题

@YIN_Austin认为：老房子最大的一个缺点可能就是这个了。老旧的材料，密封性不够好，窗户薄等等的原因。在德州，尤其是夏天，电费可能会是不小一笔。

看二手房经验总结：

考虑买二手房的话，一定去问一下卖家每个月的电费多少。
一定检查下每个房子的attic是否有做好insulation。很多二手房里，因为attic没有很好的绝缘处理，夏天的时候attic里会超级的热，导致空调费用增加。
attic通常都在房子的最上面，需要通过梯子才能上去。

老房子可能有含铅油漆

@YIN_Austin 给大家提出了一个买二手房可能不常见，但要注意的问题。若房子是1978年前盖的，可能会有含铅的问题。在买这种房的时候，需要签一份lead paint的表格，表示买家已知情。

看二手房经验总结：

并不是所有1978年前的房子都会有铅的。但要得知有没有含铅，一定请专业人士来做测试。
就算你住的房子是1978年前盖的，并且测出含铅的话。只要墙体没有脱落掉漆，不要擅自祛除的话通常没事的。
切记，一定不要让小孩子接触或吃到。铅对人体的伤害相当大。

看Open house可以提出的问题汇总

有些房子在图片上看着非常decent，现场去看又是另一个样子了。去看房的时候，@QT0919 总结了以下需要注意的参考因素（次序不分先后），大家在看房子的时候可以根据情况向卖方提出来。

年份、面积、卧室大小、客厅大小
是否有后院？草地/水泥，大小，是否有篱笆？
厨房设计是否喜欢？一字形、L型、T型、U型、岛型…
property tax
浴室有天窗吗？采光如何？
客厅/房间（尤其是主卧）的朝向
地板是实木，laminate，还是engieering wood?
学区多少分？离学校的距离
房子有几层楼？房间都分布在哪一层？
是否有壁炉？是否有暖气/中央空调？
现在看房里的摆件是都是租来摆设的，可能有一些要维修的地方被家具挡住了，要留意
这条街上三个月内（甚至一年内）交易的房子资料都可看一遍

去看房子的时候，如果整体看下来挺喜欢的，建议大家多问Seller’s Agent下面这些问题，有助于对房子更深入地了解！

房子的屋顶多少年了？
为什么上一任屋主要卖房？
三年内房屋里有出现过任何意外事件吗?
你们的目标价是多少？
Offer Due Date 是什么时候？

Source

想买1960-2010年间建的房子？这些房屋建造缺陷需要额外注意

在美国买房，其实不怕买到老房子。很多老房子都位于便利的中心地段，有不错的升值空间。

但随着时间的推移和建筑技术的发展，很多老房子会暴露出属于特定年代的各种问题。所以想买老房子的时候，得额外注意每个年代的建造缺陷。

今天，我们就来聊聊1960-2010年间，每10年里有代表性的建造缺陷，让你能更有针对性地看房、选房。

1960s的建造缺陷

1. 隔热差

做隔热是在1965年才被正式写进Building Code（建筑规范）里的，所以1965年前建的房子很可能没做过隔热。

没做过隔热的房子冬冷夏热，暖通空调需要长时间不停运转才能勉强维持一个室内的温度，非常耗电。

建议在外墙内铺设新型隔热材料。

2. 含铅涂料

60年代的房子大概率使用了含铅涂料来粉刷室内外墙面。这种涂料中含有致癌物石棉（Asbestos），石棉是一种矿物纤维，如被人吸入，可能致癌。

建议请专业人员上门鉴定并彻底清除后，做全屋重新粉刷。

1970s的建造缺陷

1. 爆米花天花板

70年代流行一时的爆米花天花板，现在看来不仅不美观，而且其涂层材料里也可能包含了石棉。

如果你买的房子还保留了爆米花天花板，最好不要自行铲除，这样做会让石棉纤维弥漫在空气中，很不安全。建议请专业人员上门清除。

2. 铝合金电线

70年代铜短缺，铝取代铜成为制造电线的原材料。但是铝易被氧化，热膨胀性能也特殊，所以铝电线易过热而引发火灾。

建议找电工检查保险丝盒（fuse box）和所有插座（outlet）里的电线，把检测到的铝合金电线都更换成更安全的铜芯电线。

1980s的建造缺陷

1.PB聚丁烯水管

灰色的PB水管在80年代被大量使用。可这种水管易氧化，也容易被水中的氯（chlorine）物质腐蚀。

再加上80年代水管接头处的安装工艺不佳，所以引发PB水管爆管和渗漏。

建议更换掉所有的PB水管，使用更环保安全耐用的新型材质水管。

2.横置式暖炉系统

80年代的很多房子都在阁楼里安装了一种横置式吹风暖炉系统。

这种系统会在内部嵌装一种容易过热的NOx金属管，再加上阁楼内通风条件差，所以会有火灾隐患。

建议把这种暖炉系统全部拆除。

1990s的建造缺陷

1. 天花板低矮

90年代的很多房子都是矮房顶，造成房间采光差，空间感局促。

这种设计上的瑕疵可以通过拆除一些内墙和加开外窗增加采光来改善。

2. 金属屋顶涂层

金属屋顶因其防水性好，寿命长如今已越来越受欢迎。

但是90年代一些房屋安装的金属屋顶是用一种特殊合金制成，它与后期保养的涂料不兼容，从而导致表面涂层大量脱落。

建议找专业金属屋顶保养人员来处理。

2000s的建造缺陷

1. 建造质量

2000年前后，建造商开始批量建房，有些建商为了压缩建造成本，可能使用一些质量不佳的建筑材料，或者在一些建造规范code上仅仅做到勉强达标。

这就意味着，有时候房龄轻的房子反而质量堪忧，还不如老房子坚固。建议在购买房龄在20年内的房子时，也一定请验房师仔细检验审核。

2. 湿地基

由于建造商追求建造速度快、周期短，他们可能在地基未干的时候就开始安装地下室立柱和防潮层。

这种做法会将水分困在墙壁内，随着时间的推移会生长霉菌。如果发现家中墙体发霉，建议找专业人员处理霉菌问题并检查地基的湿度。

不论是购买什么年代的房子，都要做好房屋检查，发现问题找专人及时维护。

贷款利率飙升，今夏房价将继续上涨，但增速有所放缓

去年在美联储宽松政策下，抵押贷款利率下行，美国购房需求旺盛；今年随着美联储开启加息周期，抵押贷款利率开始飙升，但专家表示，美国地产市场到2022年不会有太大的缓解。

随着美国通货膨胀以四十多年来最快速度上升，抵押贷款利率的上升和物价飙升，人们愿意支付的房价可能会受到压力。

《华尔街日报》报导，虽然出现全国性房价下跌的情况很少见——触发了2008—2009年金融危机的楼市崩盘是罕见例外，但会出现房价涨幅落后于通货膨胀的时候，这实际上使住房在一段时间内更容易负担。

对可负担住房的追逐可能会带来人们购买的房屋类型和购置区域的变化。例如，根据美国全国地产经纪商协会（National Association of Realtors）的数据，2月份西部地区成屋销量同比下降了8.3%，但在房价中值相比西部低近20万美元的南部地区，成屋销量增长了3%。

以下是多名专家对2022年美国房市的多方预测。

1. 高价房屋的竞争可能会减少

美国抵押贷款利率正在上升，本月，30年期固定利率抵押贷款的利率超过5%，这是自2011年以来首次，专业人士表示利率可能会继续上升。

“大多数买家的出价范围取决于他们每个月能负担多少，随着利率的增加，抵押贷款付款会增加。因此，抵押贷款利率的上升意味着购房者将不得不调整他们的预期，并开始在较低房价范围内选择。”个人理财公司Nerdwallet的房屋和抵押贷款专家霍尔顿‧刘易斯（Holden Lewis）对“市场观察”（Market Watch）说，“我们可能会看到对高价房屋的竞争减少，而对低价房屋的竞争会更多。”

2. 买家的选择有限

Realtor.com首席经济学家丹妮尔‧黑尔（Danielle Hale）对福克斯新闻表示，待售房屋的数量已经超过季节性低点，但仍然滞后。

黑尔说，我们正在进入挂牌售房“一年中最好的时间”，并且有更多卖家进入市场。尽管如此，黑尔警告说，“整体格局仍然是买家选择有限的局面。”

她补充说，待售房屋的销售速度很快。

“即使抵押贷款利率达到11年来最高点，房屋的要价和销售价格仍在继续上涨，购房者的预算正在捉襟见肘。”黑尔说。

根据黑尔的说法，目前，典型待售房屋的融资成本已经增加了大约40%，几乎是总体通货膨胀率的五倍。

3. 房贷利率上升或迫使部分买家退出市场

美国全国房地产经纪人协会首席经济学家劳伦斯‧云（Lawrence Yun）对“市场观察”表示：“由于利率上升对负担能力的打击，许多买家将被迫退出市场。”

“15%的房价上涨和现在高达5%的利率，增加了每月抵押贷款支付数额……肯定远远高于人们的收入增长和消费价格通胀。”他说。

4. 租金上涨伤害首次购房者

由于日常必需品成本的上涨，首次购房者并没有看到房屋净值和财富增长。

黑尔对福克斯新闻说，对于这些买家来说，在原本已经充满挑战的房地产市场，租金上涨使得首次买房者难以为首付存钱。

例如，3月是单间至两居室房产租金连续第八个月增长达到两位数。

根据Realtor.com的数据，美国50个最大的大都市租金中位数达到了创纪录的1,807美元。

黑尔说，现在，锁定住房成本，以防止不得不支付更高未来租金的动力正在增加。

5. 房价将继续上涨但增速有所放缓

《财富》杂志本周报导，包括CoreLogic和房地美（Fannie Mae）在内的每家有公开预测的大型房地产公司都预测，来年房价将进一步上涨。

但专业人士表示，对买家来说，好消息是房价增长在2022年可能会有所放缓。Zillow表示，年度房价增长将“在整个春季继续加速，在5月份达到22%的峰值，然后到2023年2月逐渐放缓至17.8%。”

Zillow经济学家妮可‧巴肖（Nicole Bachaud）对“市场观察”解释说：“由于足够多的买家在价格上涨和抵押贷款利率之间达到承受能力上限，因此需求回落，我们将看到今年晚些时候价格增长放缓。”

“抵押贷款利率的急剧上升正在将更多购房者赶出市场，但它似乎也阻止了一些房主出售房子。由于供需双双下滑，市场不太可能很快从卖方市场转向买方市场。”房地产经纪公司Redfin首席经济学家达里尔‧费尔韦瑟（Daryl Fairweather）在一份声明中表示。

黑尔预计，“随着销售减少和卖家增加，市场将更加平衡”，房屋签订合同的价格和速度将会放缓。

尽管如此，“部分由十年来建房不足所驱动的失衡严重程度，可能意味着房地产市场会缓慢降温。”她补充道。

根据黑尔的说法，这意味着购房者和租房者“应该准备好迅速采取行动”，包括在寻找房屋或出租地点之前有条不紊地打理财务，并对自己是否能负担得起充分了解。

6. 雇员重返办公室或影响住房选择

Realtor.com高级经济学家乔治‧拉修（George Ratiu）对“市场观察”说：“四月可能会见证消费者活动的更广泛改善，包括随着（瘟疫）大流行限制的消退，以及我们进入新常态而旅行增加。虽然公司转向办公环境并试图让员工回到办公室和拥挤的通勤中，但加薪跟不上汽油、午餐、服装和日托成本的增加，将导致员工对灵活性（工作）的需求。过去两年远程工作的成功不仅重新定义了就业文化和期望，还让美国人有机会在远离高成本市中心的地方寻找更多经济适用房。”

他也表示，一些认为自己不必亲自重返办公室的人实际上可能不得不重返工作岗位，这意味着可以看到人们从他们在瘟疫大流行高峰期购买的更多郊区房屋，搬回城市地区。

Source: Mortgage Reports

Is buying a house still worth it?

Home prices continue to climb. And interest rates have gone up as well, increasing the cost of homeownership from month to month. Unsurprisingly, many home buyers are left wondering: Is buying a house still worth it in 2022?

The short answer is yes. If you’re financially ready, buying a house is still worth it — even in the current market. Experts largely agree that buying and owning a home remains a smarter financial move than renting for many.

If you’re on the fence about a home purchase in 2022, here’s what you should consider.

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Benefits of buying a house in 2022

Despite the financial challenges of the current market, there are plenty of reasons why buying a home is still worth it in 2022.

1. Rising prices lead to increased equity

One of the chief benefits of owning a home is that over time, increased home equity can add to your net worth and give you a low-cost source of cash as needed. The ability to build equity is what sets homeownership apart from renting, which has no return on investment.

“Home buyers who purchase a home today are still likely to see rising property values and increased home equity. That’s because supply is still relatively low compared to buyer demand, so home prices are likely to keep rising, although at a slower pace,” notes National Association of Realtors (NAR) senior economist Gay Cororaton.

“When you couple [fixed mortgage payments] with the fact that rents are increasing at record levels, it makes more financial sense to own a home and gain the equity”

–Jason Gelios, Realtor

Cororaton points out that, even with rising mortgage rates, home prices have held up. As of March 2022, the median sales price was up 15% year-over-year.

“Although home prices have fallen approximately 30% from their peak level in 2006, they have rebounded over the years, with the median single-family existing-home sales price rising at an annual pace of 3.4% from the fourth quarter of 2006 through the fourth quarter of 2021,” Cororaton adds.

Using this metric, if you bought a home 15 years ago, you likely would have accumulated $197,500 in home equity — $141,700 of which would be price appreciation.

“Over the past 30 years, a homeowner who purchased a typical home and sold it today would likely have built up equity of $360,700,” she continues.

2. Homeownership means fixed housing costs

What’s extra nice about buying a home with a fixed-rate mortgage is that “even though the value of your home will increase, your monthly principal and interest payment will remain the same over the life of your loan,” says Jordan Fulmer, owner of Momentum Property Solutions in Huntsville, Alabama.

Jason Gelios, a Michigan-based Realtor, points out that that owning real estate is still the top way to create generational wealth. “When you also couple this reasoning with the fact that rents are increasing at record levels, it makes more financial sense to own a home and gain the equity.”

“There aren’t too many investments that can provide the returns that real estate can,” he says.

3. Owning gives you opportunities renting doesn’t

Of course, there are several other advantages to buying a home today. These include:

The ability to customize your home the way you see fit, unlike a rental unit that likely won’t allow for personalization
Greater privacy from neighbors, especially if you select a single-family detached home
Home equity that can be tapped via a home equity loan or home equity line of credit (HELOC). This money can be used to fund home improvement projects, pay off debt, cover the cost of a wedding or other major expense, or virtually anything you desire
The ability to claim a mortgage interest deduction on your taxes if you finance your property
The chance to build a stronger credit rating and improve your credit score if you finance a mortgage and pay your bills on time

And then there are other, less tangible benefits many homeowners experience. For instance, you’ll likely have more room to raise a family and grow your household. And you may build roots in your community and enjoy greater stability over time. Consider that renters are four times more inclined to relocate in a given year versus homeowners, per the U.S. Census.Verify your home buying eligibility. Start here (May 22nd, 2022)

Disadvantages of buying a home in 2022

Of course, buying a house isn’t going to be the right move for everyone. There will be certain downsides to homeownership in any market — particularly the current one. Here’s what experts say prospective buyers should watch out for.

“One of the biggest disadvantages is the fierce competition buyers face nowadays. It’s really a dog-eat-dog market for buyers, making it more stressful to win a bid on a home,” says Gelios. “Purchasers will need to move quickly and be aware of what they are looking for in a home.”

Additionally, it’s getting more expensive to win bidding wars, leaving many would-be homeowners owners out in the cold. You don’t want to jeopardize yourself by borrowing more money and/or paying a higher interest rate than you can afford.

Furthermore, there is no guarantee that your home will continue to increase in value at the rate residences have over recent years. The NAR anticipates home price appreciation to slow to 5% by the end of the year — a rate of appreciation in line with historical norms.

But, while property values won’t continue to skyrocket as we saw in 2020 and 2021, they should keep growing over time. And even at a slow rate of appreciation, this leads to significant equity growth, making homeownership one of the best investments available.

Is it smart to buy a home with home prices so inflated?

Naturally, some home shoppers worry that buying a home is a waste of money because home prices are inflated — and if they drop, it could mean a net financial loss for those who buy at the peak of the market.

However, The experts we’ve interviewed throughout 2022 agree that a housing crash is highly unlikely.

“I don’t believe there will be a nationwide crash. For a crash to occur, the supply and demand situation would have to flip upside down, with more inventory existing than the number of buyers,” Fulmer explains.

“However,” he continues, “I believe that many markets around the country have seen artificial inflation over the last couple of years. These markets will likely see significant corrections due to rising interest rates and other economic factors.”

“If you are purchasing in an area with consistent growth and a robust economy, you likely have nothing to worry about when paying above the asking price on a house… In these markets, the value will likely continue to rise above what you paid for the house.”

–Jordan Fulmer, Owner of Momentum Property Solutions

Gelios agrees that we are not in a market bubble. “Unlike what we saw back in 2008, there are no current indicators of a housing market crash occurring. For example, we continue to have competitive homebuyers who are willing to pay cash above the asking price and a healthy job market with many positions being unfilled — two signs that we are in no way headed toward a crash.”

He adds, “Even with inflation increasing the prices of everything from groceries to automobiles, we won’t see the housing market go down anytime soon. The demand for homes will remain with us for a long time, especially as first-time buyers reenter the market this year to get their shot at owning a home.”

Keep in mind that most people shopping for homes today are millennials who have postponed buying a house and are eager to become first-time homeowners. As Gen Y continues to feel pressure to accommodate their partners and children, they will join in hunting for and buying homes. That means pricing pressures aren’t going anywhere.

“If you are purchasing in an area with consistent growth and a robust economy, you likely have nothing to worry about when paying above the asking price on a house — assuming you can afford the monthly payment,” adds Fulmer. “In these markets, the value will likely continue to rise above what you paid for the house.”Verify your home buying eligibility. Start here (May 22nd, 2022)

Buying versus renting in 2022

While home prices have increased rapidly over the past two years, renting isn’t always a more affordable alternative. Rent prices have been skyrocketing in many places, too.

“We are seeing rental increases of $300 extra per month in my market. That impacts how much you can spend on your basic life necessities like groceries, gas, and utilities,” says Christian Ross, managing broker at Engel and Volkers in Atlanta. “There is also a persisting shortage of rental supply in many markets, meaning you may have an easier time finding a home for sale than a rental.”

Housing payments vs. rent payments

“I would focus more on your monthly payments than the likely prospect of home appreciation and increased equity,” he continues. “If your mortgage payment will be less than you would pay in rent for a similar house, you should probably go ahead and purchase a home.”

Suzanne Hollander, a real estate law professor at Florida International University in Miami, says it’s crucial to perform your due diligence here.

“To know if it’s more expensive to buy or rent in your market, you need to do your homework and calculate the math. Learn the sale prices of comparable properties in your area and the rental prices for leased properties. Calculate the amount of your monthly mortgage payments based on your research of the likely sale price compared against the amount of your expected monthly rental payment,” she recommends.

Mortgages are fixed, rents are not

Keep in mind that if you choose a fixed-rate mortgage loan to finance a property, your monthly principal and interest payments will stay the same throughout your loan’s term. (Though keep in mind that property taxes and homeowners insurance rates can increase over time.)

“In contrast, rental rates are not predictable,” says Hollander. “Normally, a tenant signs a one-year rental contract. And at the expiration of the contract, the rental rate will probably increase. Only five states and the District of Columbia have rent control laws in place.”

If you expect a job relocation or a move in the next few years, it may be more advantageous to rent than purchase, however. That’s partially because you’ll incur closing costs on a home purchase, which may equal 2% to 5% of your borrowed amount. It will probably take a few years to recoup those costs, which requires staying put.

Your next steps

Still undecided about buying versus renting?

“Consult with an experienced Realtor and mortgage lender, who can help you explore what options are available at your budget and shine a light on your financial situation,” advises Ross.

Also, carefully research the state of your local market.

“If there is an influx of jobs, there will probably continue to be more buyers and sellers, resulting in continued growth in home prices,” says Fulmer. “In a less robust market, it might be smarter to continue renting in anticipation of a possible market correction and lower home prices.”

The bottom line? Provided your finances are in order, your job is secure, you can afford the monthly payments, you’re working with a skilled real estate agent, and you will remain in place for at least a few years, buying a home will not be a waste of money in 2022, the pros agree.

Buying a Fixer Upper: How to Find, Afford and Improve a Fixer-Upper Home

Searching for your dream home and wondering if it’s worth buying a fixer-upper and making it your own? Here’s what you need to know.

Buying a fixer-upper involves purchasing the least desirable home on the block and overseeing its transformation. Whether you’re considering a fixer as an investment — and you plan to sell after construction is complete — or you’re fixing up a home to make it your own, there’s a lot to consider when buying a fixer-upper, from home price to construction costs to financing.

What is a fixer-upper home?

A fixer-upper is a home that needs repairs, but not so many that it’s uninhabitable or worthy of being torn down.

Fixer-uppers are usually offered for a lower price than homes in better condition, which makes them appealing to buyers looking to maximize their purchasing power or investors looking to flip the property and turn a profit.

Should I buy a fixer-upper home?

Most often, people buy fixer-upper homes because the cost of purchasing the home plus renovation costs may total less than what they’d pay for a comparable home in good condition.

Here are some of the key reasons buyers decide on buying a fixer-upper:

Reduced price

If you have your eye on a popular neighborhood, either for resale value or your own lifestyle, you may be able to get a better deal buying a fixer upper in your desired location and renovating it than purchasing an already-updated home.

Customizable improvements

When you purchase a fixer-upper, the sky’s the limit when it comes to fixtures and finishes (within your budget, of course). Renovating a fixer-upper can be ideal for buyers with very specific tastes or those who want more control over the aesthetics of their home. When buying a fixer-upper, you avoid paying for the renovations someone else completed, especially if you don’t like them.

Older home charm

The character of older homes isn’t easy to replicate. Buying an older home in need of some TLC can allow you to restore and maintain time period details, while bringing the home up to today’s efficiency, safety and comfort standards.

Make a profit

Whether you’re planning to flip or live in the home for a few years before selling, you may be able to turn a good profit based on the renovations you make. Your return on investment depends on the types of renovations you complete, the materials you use and the quality of the work. If profit is the goal, select popular home improvements in your market to increase property value and appeal to a wide variety of buyers.

Tax incentives

In some metropolitan areas, such as Philadelphia and Cincinnati, buyers who purchase a fixer-upper and renovate to improve the property value may be eligible for a tax abatement or credit.

How to find fixer-upper homes

Finding the right fixer-upper is all about where you look. Here are a few strategies for finding the right home.

Want to find fixer upper homes in your area? Narrow down your search using the Keyword section of the Zillow app.

Search online: Use Zillow to search fo r homes below market value. You can search keywords such as “fixer upper,” “needs work” or “TLC” to narrow down potential properties.

Work with an agent: A local buyer’s agent should be able to help you find fixer-upper homes in your desirable neighborhoods. Well-connected agents may even be able to show you homes that haven’t hit the market yet, via word of mouth.

Search auctions, foreclosures and short sales: Distressed properties may be in fine structural condition but are sold below market value in order to offload them quickly. It’s important to note that these homes are usually sold as-is, and disclosures might not be available, so be sure you have enough extra money in your budget to cover surprise issues.

What to look for when buying a fixer-upper home

When shopping for a fixer-upper, prioritize the things you can’t change about a home (like its location), or things that would be too costly to change (like significant structural renovations). Here are key factors to consider:

Location

Location is the most important thing to look for, because it can’t be changed. Look for a fixer-upper in a desirable or an up-and-coming neighborhood in order to maximize potential resale value. Finding the right location will also ensure that you’re happy in the home. Pay attention to things that might be important to you, like school ratings, nearby parks and restaurants and commute times.

The home’s location will also play a part in determining your renovation budget and estimating the home’s post-renovation value. The quality of finishes and upgrades you select should be in line with comparable homes in the same neighborhood if your goal is to recoup costs on resale.

Layout and size

With a fixer-upper, you might be able to change the layout as you see fit, but pay attention to any design and layout ideas that would require removing load-bearing walls. This can be a costly exercise, and sometimes it’s just not possible. Home additions to increase square footage are also expensive and might not be allowed, depending on local zoning requirements and laws.

Home condition

There’s a difference between a fixer-upper and a home with significant structural defects. Structural and mechanical problems are a lot more expensive to fix than cosmetic ones. Be sure to hire a home inspector to gain knowledge of the home’s positives and negatives — hiring a home inspector is an invaluable step, even if you’re buying a home as-is. Here’s what should be on your home inspection checklist for a fixer-upper:

Strong foundation
Up-to-code electrical
Proper plumbing
Solid roof condition (should come with roof certification)
HVAC and/or central AC
Functional windows

Straightforward cosmetic updates

Prioritize homes that have outdated or worn out finishes that don’t appeal to the general public but can be updated affordably and without too much effort. Ideally, the fixer-upper you buy will only need cosmetic upgrades. Look for homes with:

Peeling or dated paint (interior and exterior)
Older bathroom fixtures and tile
Dated kitchen cabinetry
Laminate or tile countertops
Stained carpeting
Hardwood floors in need of refinishing
Leftover belongings or trash that need to be removed
Neglected landscaping
Old or non-functioning appliances

How to buy a fixer-upper

Buying a home that needs work can be risky, because you won’t know the full condition of the home until you start tearing down walls. That’s why doing your due diligence on the property and neighborhood ahead of time is key.

Get a professional home inspection

When you put an offer on a house, be sure to include an inspection contingency. An inspection contingency allows you to back out of a deal and get your earnest money deposit back if the inspection reveals that the home has serious hidden defects.

Even homes marketed as being in “as-is condition” can be inspected — the only difference is with an as-is home, the seller is telling you that they do not want to make any repairs based on your findings.

The buyer is responsible for the cost of an inspection, which ranges between $250 and $700, depending on the size of the home and your location. In addition to a general inspection, you might also opt for specialized inspections for trouble areas. Common specialty inspections include pests, sewer lines, radon, lead-based paint and structural inspections. Costs for specialty inspections are similar to general inspections.

A structural inspection reviews the home’s structural integrity, but also lets you know of any natural hazards nearby that could impact the resale value or your own health and safety. You may also consider hiring a structural engineer to assess the property before you make an offer. It will cost between $500-$700 but could save you thousands of dollars in future foundation repairs.

Hire an architect and general contractor

An architect can create a new layout for a home, create plans and blueprints and tell you what is and isn’t possible. Some cities require you to submit architectural plans to acquire home permits, making an architect a necessity. The average cost for an architect is around $5,000, depending on the scope of your project.

Your home inspector should be able to give you a rough estimate of what it would cost to adequately repair problem areas that come up in an inspection, but since they’re not the one who will be doing the work, it’s best to get a more accurate quote from a contractor. Whatever they quote you, add a 10% contingency for any problems that come up along the way. Be sure to get quotes from a few contractors and do your due diligence in checking their licensing and customer reviews.

Budget for improvements

Working with your contractor, be sure that your budget takes into consideration all applicable costs. Don’t forget to include:

Permit fees, if applicable
Cost of materials, like flooring, paint, light fixtures, cabinetry, countertops and hardware
Cost of labor, including general contractors, plumbers, electricians and inspectors
Cost of living during renovations, if the home will be uninhabitable during the project

Know your limits

Above and beyond the financial concerns, you also need to gauge your tolerance for a major renovation project, especially if you plan to save money by doing some of the work yourself. Home renovations are not as easy as they look on TV and if it’s your first time, a lot can go wrong. Even if everything goes right, there’s a lot of hassle involved in a large-scale construction project. You’ll have to live in a construction zone or move elsewhere temporarily, while still paying all the carrying costs for the home. Finally, the project could take a lot longer than you expect due to supply-chain issues that have affected the cost and availability of many construction materials.

Financing options with fixer-upper loans

You can purchase a fixer-upper with a traditional conventional loan then pay for all the improvements out of pocket. Or, you can get a fixer-upper mortgage that’s designed to help you finance both the house itself and the renovations. Common types of home loans for fixer-uppers are:

FHA 203(k) standard

An FHA 203(k) Standard loan finances the purchase and renovation of a primary residence. Here are the key requirements:

Minimum credit score of 500 with a down payment of 10%, or a credit score of at least 580 with down payment of 3.5%
The total cost of the loan must fall under FHA mortgage limits in your area
No luxury improvements (like pools) are allowed, but structural work is allowed
Requires a HUD consultant to approve the architectural plans, oversee payments to contractors and review inspections to ensure the home meets structural integrity and energy efficiency standards
There are limits on how soon you can resell (not within 90 days)
The contractor is paid out of an escrow account managed by the lender

FHA 203(k) streamlined

This financing option has similar requirements as the FHA 203(k) Standard, but it’s meant for simpler, cosmetic renovation projects, as it has a spending limit.

Minimum credit score of 500 with a down payment of 10%, or a credit score of at least 580 with down payment of 3.5%
For cosmetic upgrades under $35,000
There are limits on how soon you can resell (not within 90 days)
The contractor is paid out of an escrow account managed by the lender

HomeStyle loan

A HomeStyle loan is a combination home loan and home improvement loan, guaranteed by Fannie Mae.

Minimum credit score of 620; minimum down payment of 3 or 5%, depending on a few factors like owner occupancy, first-time home buyer status and income
Allows for other improvements that aren’t covered under an FHA 203(k), like pools and landscaping—but note that all improvements need to be “permanently affixed to real property (either dwelling or land)”
The contractor is paid out of an escrow account managed by the lender
You must use a certified contractor

CHOICERenovation

A CHOICERenovation loan is a combination home loan and home improvement loan, guaranteed by Freddie Mac.

You can finance renovations that cost up to 75% of a home’s value
Money can be used for upgrades that prevent natural disasters
You can DIY the work and get a down payment credit
Requires multiple appraisals to ensure you’re upholding the terms of the contract and that the agreed-upon renovations make the home meet its estimated value