How to Make Sure You’re Not Buying a Money Pit


(guest post by Ryan Tyson; image via Flickr by oatsy40)

Homebuyers face a certain degree of risk when they sign on the dotted line. They might think they’re making a good deal and getting the home of their dreams, but they could be investing in a money pit that costs them thousands of dollars in repairs and upgrades within the first six months of their moving in. Fortunately, you can avoid buying a money pit as long as you know what to look for and how to negotiate. Follow these three steps to make sure that your home loves you back.

Attend the Inspections Yourself

You may have to take a day off from work for these appointments, but attending the inspections yourself will give you an idea about what repairs you need to do and any problems you’ll face. Instead of seeing the house with excited homebuyer eyes, you will see it as a homeowner.

Take notes as you’re going through each phase, from pest inspection to the foundation, about what you need to update along with the cost. In addition, make cosmetic notes about what you would change about the flooring and paint. These notes will give you an accurate picture about what you will need to pay for renovations once you move into the home.

Include Upgrades and Fixes in the Negotiation Stage

After the inspection, review the list of potential problems and issues and make a list of items that you don’t want to handle yourself. For example, if you’re buying a home with a screened-in patio and the screen has a huge tear in it, note that you would like the screen repaired. Or perhaps the previous owners painted a room dark purple that you want painted beige. For your own notes, place a monetary value next to each of these fixes so that you will understand the average cost to the homeowner.

Include these fixes in the contract as a buying condition. This list of repairs puts the burden on the homeowner to make the updates before you move into the home. You’ll save time and money by not making the repairs yourself.

Check the Age of Major Appliances

Although the inspector will make note of performance issues for appliances such as the dishwasher, oven, and HVAC system, you should also check the ages and average life spans of the appliances. Even the best-kept older appliances are at risk of breaking in the near future, and if all of your major appliances are reaching the end of their lives, you could face an expensive first few months in your new home.

If the homeowners are leaving items such as washers and ovens for you, consider replacing them before you move in, and stipulate in the contract that you would like the older appliances removed. This provision allows you to install updated energy-efficient equipment.

The best homebuyers are informed homebuyers, so make sure that you understand your rights as well as the rest of the entire process, especially if you are buying a home for the first time. When you are proactively informed, you won’t have to end up unhappy and in a home that continues to cost you money.

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