Are you interested in buying a new-construction home or are you more attracted to a “fixer upper?” Purchasing an older or existing home is ultimately a personal preference and a decision that should be made when armed with all the right information. Older homes have many benefits that you won’t find in newer homes, such as undeniable charm, desirable locations, and affordability, while new-construction homes can have the added benefits of newer materials and energy efficiency.
Still on the fence? Your best bet is to not rush into making your decision. Do as much research as you can on the property, plus potential benefits and downsides, and enlist the help of a real estate expert who can help you see past the surface.
Below, we put together a quick guide and five tips to help you navigate the process of buying an older home so you can be as prepared as possible.
Did you find an older home you loved, with a low price tag as an added bonus? Don’t get too excited just yet! That lower price may account for repairs that the seller may not be prepared to take on themselves, whether financially or due to a time constraint. As with many homes, older homes are especially prone to needing updates, whether cosmetic or functional. That’s not to say that the home isn’t worth purchasing, it just may require extra consideration and perhaps more patience. Compare how much you will be saving by purchasing an older home with the time, energy, and resources it will eventually take to make it the home of your dreams.
Tip: If you find the home of your dreams, but it has a low price tag, do some research, ask questions and determine what the needs are before getting serious about it. In addition to obvious steps (touring the property and having your real estate agent get as much information through the seller’s agent), you should also request past inspection reports and relevant paperwork to pinpoint a home’s possible problem areas.
In order to help make up your mind about a home purchase, gather a team of different experts that can help with your decision. Not only does this include your real estate agent, but also consider an engineer, contractor, and certainly an inspector with plenty of experience in older or historic homes. While bringing on this team may be costly upfront, they’ll likely give you peace of mind when it comes to being certain of the condition the house is in. For example: older homes were built to last, but what about the plumbing, electrical, heating, roofing, etc? If you don’t thoroughly inspect a home prior to buying, you may end up with hidden expenses later.
Tip: Hire a team to complete a full inspection before committing to the property so you have a full understanding of your purchase.
This one definitely depends on where you live, but some older homes come with restrictions in terms of what can and cannot be done to them. Before committing to any plans, check with the Building and Planning Department in the home’s area to find out what these restrictions are. An example of restrictions could be a historic designation which may prohibit additional structures, property fencing, or even interior layout changes.
Tip: Get a quote from a potential planner and review renovation plans before purchasing the home to get a better picture of what can or can’t be done so you know what to expect when it’s time to begin renovations.
If you’re not the type of homeowner that is up for challenges, then older homes might not be for you. While older homes have the reputation of being strong and sturdy, they might also have plenty of hidden issues that often cannot wait. From new roofing to window replacements, you may be facing $500-$11,000 in additional repairs. Even if you don’t have these issues when you purchase, this is something to keep in mind for the future.
Tip: Consider all costs associated with buying an older home. In addition to the cost initial updates, take into consideration that there may be annual repairs needed, simply due to the nature of the home’s age.
Like all insurance, homeowners insurance is priced based on total risk. Insurance providers know that older homes come with different risks than newer or brand-new homes, so you can expect them to present you a quote based on those potential problems. Our partners at HomeServices Insurance Agency are ready to assist with all your homeowners insurance questions and needs.
Tip: We highly suggest collecting quotes early on so you can see how insurance might affect your spending limit and so that you will know at time of closing that you’re getting the best deal possible.
Thanks to our PINNACLE home services program, you can make updates and renovations to your home with no money out of pocket until your home closes escrow. PINNACLE gets your home market-ready and helps potential buyers envision what their future looks like in your home.
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July 10th, 2020 at 11:00 am