I've been trying to figure out the best way to title this blog post. There's a lot of ways it could be said but basically what I am trying to convey is. For instance, I sold a friend a house several years ago and they loved the house and its location but there were a lot of things they wanted to change. They wanted to rip out a wood-burning freestanding stove with a wall of brick behind it and make it into a bigger room without a central heat source in that room. They wanted to open up a wall and make a bigger kitchen as well as a redo the countertops and cabinetry. They wanted to redo the basic layout from one living room to another as it was kind of an inconvenient design. 10 years later when I sold the house for them, not a thing had changed. Things had come up, money was tight, and of course, a renovation costs a lot of money.
I'm bringing this up because there have been a lot of remodeling and renovation blogs lately. I get it, it's the season, people are refinancing or thinking about changing or updating their homes so spring is a really good time to talk about that. But that also brought up the topic of buying the home with plans to change the house, and then never actually making those changes.
I'm not saying that everybody does this; many people buy a home with a lot of extra money to spare and the sole purpose is to renovate the home either for themselves or the flip it and sell it for a profit. But for first-time homebuyers that don't have a lot of equity built up or even savings, grandiose plans of remodeling a house right off the bat might be more talk than action.
So how do you navigate this somewhat delicate conversation with buyers?
First of all, if you have first-time homebuyers that are looking for a fixer-upper it's important that they understand what that terminology means. In Realtors® vernacular, "fixer-upper" could mean anything from new appliances needed to an all-out demolition and rebuild. Dreams of being on some HGTV show and completely remodeling the house on a millennial or young married's budget (no offense to anyone not on that type of budget), is usually much higher budget than most people are expecting. Adding in $1000 appliances might seem doable, but revamping the entire house and redoing floors, counters, and cupboards could end up being over $20,000 or more. Probably not the type of change that first-time homebuyers have, especially after making a down payment and adjusting to a new mortgage payment.
Try to talk about the necessities that buyers really need. Are they looking to be in a specific school district, location, basic plans of how big the house needs to be? These items are usually set in stone. From there we can start looking at properties that don't need a lot of work. Try to remind your buyers that this may not be your forever home. Build up some equity and consider buying a larger home or playing with the idea of remodeling once you have built up equity and have a little more cushion financially.
Of course, sometimes you can't talk people out of big design dreams if that's what they are going to do but I think it's our duty to inform them an estimate how much some of these repairs could be. Plus, once you start a remodel project there's usually some hidden costs involved whether it's a water leak, a change in design, or, as the case may be a lot of the time, one thing is leading to another. Once you replace the flooring then comes the trim, on and on etc.
I think it's important to be real with your clients. If you know they have remodeled before, settling on a home that needs a little bit of work is a no-brainer to them. But those that have big dreams of changing everything in a house might find themselves five years down the road without one thing changed because it was either too overwhelming or they can't save the money to do these large renovations. It's just important to be real with them and help them think about the possibilities. Maybe find a home that just needs a few cosmetic upgrades such as paint or new lighting fixtures. Start small and help them find something that not only they can grow to love, but maybe build equity over time and then jump into a larger project down the line.
As a certified Realtor® for the top-rated Columbus Realty Firm - Vision Realty, with 32 years of dedicated real estate experience, I can help buyers, sellers, investors, short sale sellers and more find, sell or invest in the right property, at the right price, at the right time. Contact me anytime for updates and information on the Columbus OH Real Estate market.