Looking at Buying Fixer Upper Need Some Advice

[joecaption]

I agree that siding is a mess.
The trim, fascia's, and soffits where suppose to be done first before the siding went on.
Not likely your going to have the 40' Ladders, walk boards or siding tools to do that job so going to have to hire it out.
That stoop never should have been built tight to the doors threshold like that and should have been built free standing, and it's missing some of the railing.
$5000.00 on an old house like that would not last me 2, weeks in just material cost.

 

[artistkate]

Im loacted in Iowa, stuff here is not overly expensive. My dad hired someone to do his siding, windows, gutters, every thing but the roof and it was 13k. And they have 3 different colors of siding on their house to make American flag in the roof peaks.

 

[bud16415]

The house we bought was also a short sale property owned by a bank. In our case the bank was across the country and they only knew one thing about the house and that is they have to sell it. Most likely the information the realtor has is all you will get unless you want to say hi to the neighbors. Chances are the bank is into the house for more than they will get back and there could be other leans against the property. We used a title search and title insurance company to handle the whole closing. There are 1000’s of these houses stuck in limbo across the country and these banks that ended up with the paper on them don’t want to pay taxes and water bills etc.

The realtor normally gets talked into trying to sell them as they don’t really want to as its as much work or more messing around showing them and there is so little profit at the sale. The one we worked with said at the closing that’s it no more short sales for him.

With the house being as is condition that scares off lots of people. When I bought my first house that was the norm now everyone wants to feel 100% safe before or they won’t spend a dime. That’s where the risk reward comes in. joecaption is correct you can blow thru 5 or 10k really fast and unless you are really in the top tier of DIYer’s you don’t want to be on a 40 foot ladder trying to do that trim work. On the other hand it’s not going to fall apart over night if you can live with the look and save up some money to get it fixed right.

All these items to think about seem like a million details. A lot of people can’t handle thinking about all this stuff and the stress isn’t worth the savings for them. The people I feel sorry for and I have seen it many times is the ones that pay top dollar for a house like this after a flipper spent 6 months making it look great. For me if you buy a place cheap and it has some issues down the road it wasn’t like you didn’t know they were coming.

That chimney looks like it was taken down and shortened and a liner ran thru it. Get down in the basement and see what the furnace is? My guess is it’s a newer unit. Check out the electric panel? The service coming in looks to be newer chances are the house has been rewired also. Get into the attic and see what they have done for insulation? Look for water in the basement and any mold. Looks like the house had a couple of additions added. Is there basements under them or access to a crawl space?

 

[artistkate]

So I talked to the realtor and I guess it's not bank owned. It was bought by a couple in 1970 and they raised their family in it and then when they retired they moved to a smaller house and let their kids live in this house, the kids trashed the place and now the elderly couple is trying to sell it. He said all wiring is tied to a breaker, none of it is knob and tooth. Plumbing was redone as well. He said someone else has made an offer but they are having issues getting the loan and encouraged me to go look at and put in an offer if I'd like because they are able to back out still. It makes me think that there isn't really an offer on it. He said as far as he knows there is no water damage, it's all just from the couple's stupid kids.

 

[bud16415]

The story doesn’t seem to go along with the photos. The house wasn’t trashed the damage was neglect more than anything. The areas that have been worked on are not beat up looking just unfinished. It seems there is always this other couple that just put in a bid but are having trouble with financing. I think I heard about one when we bought our house as well. We had the advantage of buying with cash so that cut out a lot of fooling around with banks. You won’t know until you talk to a banker what their policy is regarding distressed properties. I have a feeling the size of your down payment along with how good of a deal you can get on it will sway the bank. They want to make a loan but when things get out of the typical mode they really want to be secure and sure they will get their money back if there is a default on a loan. I would say if you are borrowing around what the lot was worth they wouldn’t have many issues. Sometimes credit unions will loan money for things like this also. We don’t know your finances but I would be looking for something short term if you can swing it, like 5 years.

As far as another offer pending and all that. It has nothing to do with you what someone else is doing. If you decide you want to make an offer. Offer what you think it is worth to you and not a penny more. The only smart place to be in negotiating is to know there are another 100 places just waiting for you and if you get this great and if you don’t “oh well” that’s ok too. Everything is only worth what someone will pay for it.

You need to take someone with you that understands buildings when you look at it again. Someone that understands your dream but also will give you the straight scoop on what they see.

 

[joecaption]

Something's also up with those shingles.
Ether someone's installed about three layers or there shot.
They should be laying on the roof, not all wrinkled up like that.
Steep pitch, multi story, Highly possible there's more then one layer and I'd also guess no ones ever installed new sheathing over the old slat boards so there's going to be some damage.
Going to cost about 3, times as much to reroof as a regular ranch would cost.
$5000.00 may not even cover the material cost.
And It's not a regular DIY job.

 

[nealtw]

Something's also up with those shingles.
Ether someone's installed about three layers or there shot.
They should be laying on the roof, not all wrinkled up like that.
Steep pitch, multi story, Highly possible there's more then one layer and I'd also guess no ones ever installed new sheathing over the old slat boards so there's going to be some damage.
Going to cost about 3, times as much to reroof as a regular ranch would cost.
$5000.00 may not even cover the material cost.
And It's not a regular DIY job.

Joe, Just to clairify. With what we have seen so far and if you were inclined to buy a fixer upper and you were not going to do the high outside work, would you consider a house like this when it is $100k below market value. We also don't know the surprizes in the full value houses.

 

[artistkate]

I don't see any issues with the shingles, yes there are a few spots that need redone and I agree the siding would need redone, but I don't see layers of shingles except in the corners. We have decided to look at a couple of other houses this weekend and then put and offer on it, take it or leave basically and if they take it then awesome and if not oh well. There is another house that is listed at 54 that is much nicer but I hate the kitchen, it's small with no room to expand without completely changin the whole downstairs and not sure if wiring has been updated or not.

 

[bud16415]

One thing we talked about when we bought our fixer upper was because it needed so much on the interior it wasn’t going to take any more work to change things that we didn’t like. In a way the next step up from a house like this can be more work because there is always that not wanting to wreck something that is really ok to change something else you may want to change. The walls we took out and moved or added new were fairly easy decisions to make.

We also looked at some for 3 or 4 times what we paid and they were ok and livable right off. We looked at the cash flow and said beyond painting and cleaning up the difference in money going out was going to keep us pretty much with what we had in those places.

It really boils down to if you are the type of person to do a lot of hard work or have the skills to DIY what it needs. There is a huge difference between doing a weekend project and sticking with something for a year or two. If you are then the end result can be really rewarding.

 

[artistkate]

I'm definitely a DIYer but at the same time I have to think short term as well as long term. I have a 2 year old and need a place we can move into within a month of purchase. I am very ambitious but don't want to be overwhelmed. I do appreciate all the help you have all given me and I know I'm gunna end up with a project house, it just depends on how much I end up taking on. When I look at this other house on Saturday I will definitely take pictures and get as much info as I can so you can tell me which you think would be the bebetter buy.

 

[slownsteady]

It really boils down to if you are the type of person to do a lot of hard work or have the skills to DIY what it needs. There is a huge difference between doing a weekend project and sticking with something for a year or two. If you are then the end result can be really rewarding.

Well worth repeating for anyone reading this.

Add in a two-yr old kid, who will continue to grow and have needs; think carefully.

 

[artistkate]

This is one of the houses I looked at today, it's forclosed on and 25k

 

[artistkate]

More pictures of the 25k house.

 

[artistkate]

This is the second one that we looked at. This one is listed for 54k but has been on market for almost a year, it's an estate sale.

 

[artistkate]

This is the basement and roofline. Not sure if the basement is of concern, as part of it seems to be dirt wall, but the house is 1800 sqft and the basementire is 300 sqft. Also, the roof is horrible. My realtor said she would probably offer 42k on this.

 

[bud16415]

What’s your gut feeling on the two new houses. They look to be closer to move in condition. The 25k looks to be newest of the three and also smallest and plainest. Are they all in the same area, same taxes, schools, etc? Are they all in a similar safe location?

Each house I’m sure has things you like and different problems. I have a feeling you are drawn to the older buildings and their charm. Nothing wrong with that but they do have different issues.

If all things are equal what you need to do is list each place and what needs done you cant do and the cost to get it done. Then the things you can do yourself and the costs do some math and maybe the most expensive will be the best deal.

 

[joecaption]

Any chance you have an idea on who you would call if you needed to sub out some of the work you can not do?
What I've done in the past for customers that had no idea what to look for or what there even looking at is inspect the home for them and give them some real world ideas on what needed to be fixed first, and how much it would cost for a small fee.
The deal was they had to give me the work that needed to be done.
A home inspector can not give you prices, is not going to be taking anything apart, and may or may not even be qualified.
A GC would have a far better chance of knowing what he's looking at.
FIY, the foundation and basement are extremely important when doing an inspection.
If it's failing the rest of the building is sure to follow and there's rarely a cheap fix.

 

[joecaption]

Love that picture of that window laying on the floor.
There was suppose to be at least 4, in that window there may have been 6 screws holding it in place.
There was also suppose to be caulking around the back sides of the stops to seal it.

 

[artistkate]

My favorite of them all is the estate sale. But the basement really freaks me out. All 3 houses are in different towns but all are within the same distance to my work. The 36k and 54k houses are in the same school district. Taxes are all about the same, being around 1000$ the house listed at 25k was built it 1900 and is actually older than than the 54k which was built in 1902, and the 36k was 1860. However that one listed at 25k may have a value of max 80k when fixed up. Where as the 54k could be 120 upwards to 150k as it is a growing town and school and daycare are located in town. The 36k house would be around the same price range, but being a much much smaller town, harder to sell. But I'm not really looking for a house to flip, as I plan to have this house my perminent residence. 36 k house is 2334sqft, .33 acres, 1.5 bath and 4-5 bedroom, 2 stall garage with shop in it. The 54k house is 1788 sqft, .36 acre, 1 bath, 4-5 bedroom, 2.5 stall garage. The 25k house is 1089sqft, .16 acre, 1 bath, 3 bedroom, 2 stall garage that needs redone.

 

[slownsteady]

Not sure why, but the 25K house struck me as a flip. But at that price, why would anyone invest, so i'm puzzled. That knocked in window also made me wonder if the place was ripped off. All the plumbing and electrical ok?