Nothing will test those DIY skills like a “fixer-upper” home. But sometimes we bite off (or buy) way more than we’d bargained for. Whether DIY skills are being put to work to make money, or to make a custom-designed abode, there’s some homework and calculations that need to be home. So, get those hands dirty right after you read this!
Estimating Your Offer
The experts at This Old House suggest to first estimate the total bill for repair and renovation by adding up costs for materials, equipment rentals, outside labor, and so on. Next, get a solid figure on the home’s potential value after renovation. Then, comes the subtraction of possible costs from surprise issues, inflation, and other home-y additions (this figure may vary, but the linked article from This Old House recommends 5-10%, while attorney and real estate expert G. M. Filisko suggests estimating 10-20% for unforeseen expenses). The number you get from this fixer-upper math formula gives you a sell-price that shouldn’t break the bank.
Know Where To Start
If you’re working on your DIY skills, or getting by on a tight budget, then start with the smaller stuff. Building built-in book cases, installing molding on windows, and laying a stone veneer over exposed foundation are all easy home projects for all sorts of DIYers. They don’t require fancy skills, blocking off half the house, or a new credit card, and they’ll add an instant touch of class. They’re also great projects for a beginner handyman or toolbox diva, because they’ll build up DIY skills without the headache of fancy math or special tools (although you can always rent tools or get help from a local tool library). But sometimes the big projects just can’t be put off until later. Mold, water damage, and foundation work aren’t jobs you want to put off, because fixing it later may mean tearing out all your hard work. Even less extensive stuff like refinishing floors need to be compared to other jobs like replacing cabinets or putting in a new shower (because accidental gouges and dollops are bound to happen).
Know When Costs Don’t Add Value
Adding an extra room seems like a great way to add home value, but that depends on the neighborhood. Adding a third bedroom to a home seems like it would add instant dollar value, but the value may fall short of the costs if it’s in a neighborhood full of 2 bedrooms homes. That’s because of the neighborhood and the type of buyers it attracts (because homes that appeal to older couples or single folk may not cut it for families with children in school).
The bonus of DIY work is that you can make things just the way you want them, but one person’s idea of “treasure” may be another’s idea of “garbage.” If you want to get more bang for your buck come later, focus on DIY projects that combine aesthetics, function, and smarts. Replacing doors, adding a deck, painting, refinishing floors, converting an attic into a usable room, and updating windows (or swapping them out for french doors) come with big value when it’s time to sell. Creative projects that make the home more functional, enjoyable, and pleasing can add value too, but it will depend on the neighborhood, the home, and the overall layout (ie. taking up backyard space for a shop or another addition in a family ‘hood may get a thumbs down from mom and her lively children).
Know ALL The Costs (Money, Time, Professionals, And Paperwork)
There are projects that can add value and can be done at your convenience, then there are projects that are necessary and demanding. Foundation repair, roofing, sewer lines replacement, and updated septic systems can cause huge problems down the road, so they should be looked into before you buy. Those kinds of jobs can get really complicated and costs thousands and thousands of dollars while doing pretty much nothing for home value. Experienced DIYers may be able to pull off those kinds of jobs for a fraction of the price, but they’re not all as simple as they seem. Big projects involve permits, building codes, paperwork, inspections, pricey materials, and heavy equipment. Building up to code and meeting property specifications will make sure that DIY work maximizes a home’s worth. Expertise is a must too, because project blunders can lead to a bad cause of DIY remorse. Know what you’re getting into before you find yourself sleeping in a tent in your kitchen.
Know The “Rules Of The House”
Before you get all the materials to turn that attic into a bedroom, get filled in on the details. Building a space doesn’t mean it will be recognized as a “livable” space come appraisal, so you’ll want to have a little chat with the county to figure out all the rules and regulations. Also, housing costs don’t end with renovation. Because property taxes are based on appraised home value, any housing updates that cause a rise in market value will come with a rise in that yearly bill for property taxes. Get the deets on appraisals and assessments for your county, so you’re ready for any sudden jumps in taxes.
Get Your Inspections Done
Sure, inspections are key to finding out problems, but they may also help out with renovation. Damaged flooring, compromised cabinetry, and faulty foundations can get potential buyers cash for repairs or a lower price tag. Having detailed inspections done will let DIYers estimate all the work, materials, and money their house needs. They can also find surprise fixes or pricey repairs that may or may not be worth it. The most important inspections are the foundation, plumbing, roofing, electricity, and heating and cooling. However, inspections have limitations as most inspectors don’t climb on roofs, look for pests, check appliances, or dig into the HVAC system. If there are any areas that look concerning, consider calling a specialist that will get their hands dirty.
Pay For It
Saving is obviously one way to manage repair jobs and renovation projects. But while tax returns and bonuses can fund DIY projects here and there, a hardcore fixer-upper home is gonna need a big, fat check. In that case, check out the FHA’s 203(k) Rehabilitation Program. It comes with mortgage insurance premiums that can make it more spend than the average loan, but it allows home-buyers to finance up to $35K for updates and improvements. However, 203(k) loans come with rules and paperwork, and licensed contractor work is a requirement. It hardly sounds like the best deal for a DIYer, but maybe it’s something that could help fund big projects with foundations or electrical wiring.
Master certified remodeler David Pekel recommends keeping the kitchen remodel budget limited to 25% of the home’s present value, and limiting bathroom renovations to 12-15% of the total home value. So, as much handymen and toolbox divas love Home Depot, salvaged and repurposed materials can keep your projects affordable (not to mention fun and creative). Craigslist is obviously the place to start, but don’t forget to check out the Planet Reuse online Marketplace for local reclaimed goodies. Hope in the car to check out Habitat For Humanity Restores, Building Material Reuse Centers, and local salvage shops too. You can also find fixtures that can rocket home appeal without paying a pretty penny. If you can find good deals on updated lighting fixtures, cabinets, faucets, cabinet pulls and drawer knobs, take ‘em. Just make sure that the house has an overall theme that ties them all together.
Article written by Ash Stevens, blogger over at One Damn Good Woman. Ash is a mother, writer, and a wannabe shaman. She loves health, gardening, simplicity,culture, chocolate, and sarcasm. If she isn’t writing about family and relationships on her blog, then she’s surely playing badminton with the kids. Find her on Twitter or Facebook and make a new friend!