There are enough TV shows, and social media accounts that romanticise and exalt property renovations to pure entertainment.
“It’s not that it’s not fun to renovate a property. It’s just that it needs to be approached with an open mind and lots of patience!” says Skoko Sebola, Principal at Leapfrog Midrand.
“Fixer upper” is simply the term used to describe a property that needs structural and/or aesthetic improvement. The state of disrepair often means that these properties are available at a lower purchase price than the market average.
“For some buyers the fixer-upper is a way to get into the market, or even a specific area, while others simply love the process of fixing a dilapidated property. Either way, it can be a very rewarding project and sure to add significantly to the value of the property,” Sebola shares.
There are a couple of factors worth taking into consideration before committing to a fixer upper, not least of it being whether you enjoy wading through dust, cement, building rubble and the like!
Location, always
“The worst property in the best area is a far better purchase than the best property in an undesirable area” is something of a property maxim, and definitely a guiding principle when purchasing a fixer-upper.
“The reason is simple. Much can be done to improve the look and feel, and even the structure of a property, while it’s a lot more difficult to improve an entire neighbourhood. In other words, if the fixer-upper is the way to ‘get into’ your neighbourhood of choice - do it,” Sebola says.
Good bones
While a fixer-upper, by its very name and nature, will need to be improved on, it helps if the configuration of the property is to your liking. Moving the kitchen from one end of the property to the other is a lot more involved - and costly - than simply renovating the kitchen in its existing place.
Also make sure the property is structurally sound, or make very sure of the issues that will be addressed if it’s not so that you’re not needing to replace the roof with the budget you can earmarked for the bathroom renovations, two months after taking ownership of the property.
“If possible, recruit the services of a building inspector to give you a professional assessment of the condition of the property and where you can expect to spend money,” Sebola advises.
Before you start with anything, make a list to distinguish between structural and aesthetic changes as the former is likely to be more crucial than the latter.
Structural/fundamental elements include:
- Shoring up foundations
- Fixing or replacing the roof
- Remodelling the kitchen and bathroom
- Replacing the windows throughout
- Building new additions like bedrooms or a garage
Aesthetic changes would include:
- Patching walls and painting
- Installing new light fixtures
- Replacing doors
- Refacing kitchen cabinets
- Fixing minor plumbing issues
READ: Dream home or nightmare investment? Handy checklist when buying a fixer-upper
Return on investment
The fixer-upper may have been purchased for a bargain but it will cost money for the property to reach its potential.
“A good approach is to use what you save on the purchase price to fund the improvements. It may also be possible to register a bigger bond and access that capital for the renovations. A trusted advisor is a useful resource in this regard and will be able to advise on an individual’s specific scenario,” Sebola says.
Draw up a plan that clearly outlines what the final product should look like, taking resources like time and budget into consideration, as well as the ultimate goal of the fixing.
Manage expectations, and be patient
Seasoned renovators will tell you two things: The first is that you will have to get your own hands dirty (literally!) somewhere along the way and the second is that there will be an unforeseen expense (or two) somewhere along the way.
“Know what you’re in for, clearly define your goals and budget, and keep your eye on the desired final outcome, and it will be fine!” Sebola believes.
READ: 9 cost-effective room transformations that will redefine any space
Mike Greeff, CEO of Greeff Christie’s International Real Estate, urged buyers in article published in February 2019, to recognise the undeniable opportunity of buying a fixer-upper property.
According to Greeff, these are some of the definite advantages of buying a property in need of some TLC:
1. Buying a property at a good price
Fixer-upper properties are not high up on the list of desirability, and as such they can in most cases be bought at a fantastic price from an agency and a willing seller. Sellers of fixer-upper properties are aware that their properties may be a difficult sell and will take this into consideration when deciding on a selling price for their home. Those looking to get into the market as first-time buyers could benefit from the pricing of fixer-upper properties.
2. Freedom to put your own creative spin on things
Putting your creative spin on things allows you to bring your vision to life. If your fixer-upper property does not require major reworking, then cosmetic changes may be the way forward. Simple changes such as interior decorating and lighting could be all that is needed to make the transformation of your property a success. If you have a certain colour scheme in mind or would like to use one of your favourite colours, this would be the perfect place to live out your colour scheme dreams.
In letting your creativity run wild, you are free to reassign rooms to serve different purposes than what they may have initially been used for. This could mean assigning would-be living areas as bedrooms, extending kitchens by breaking down walls, etc. The options are limitless and entirely up to you.
3. You can upgrade your property and ‘flip’ it for a tidy profit
Buying a property for a potential upgrade is not always about using it as your residence. At times, this may be for the purpose of ‘flipping’. Flipping properties has become widely popular in recent years with shows such as Flip or Flop and Fixer Upper becoming television sensations.
Flipping a property simply means taking a property (in most cases fixer-upper properties) and completely renovating it to be resold once again, whereby the seller makes a considerable profit from the sale of the renovated home.
Whatever you may choose to do with the fixer-upper you buy, the opportunities are endless and can be achieved with just a little bit of effort, imagination and innovation.
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