Buyer Beware! If you are a first-time home buyer or a seasoned home buyer, you have heard this phrase at least once in your home buying experience.
I will admit it I am an armchair fan of the TV show House Hunters Renovations. It always amazes me the way folks tour through a home and talk aloud of how they would transform various rooms, knock out walls and expand kitchens and bathrooms.
But things change quickly as their contractor uncovers problems after problems that hits the budget and causes delays. What contingencies can buyers do to help offset the impact of these hidden problems lurking behind the walls of their dream home.
1. Get a home inspection. Many people forego a home inspection in favor of a quick closing and because they do not want to lose the house. It is best to be safe and have the report than to uncover the problems later.
2. Realize your new home has secrets. Even new construction has its skeletons in the closet despite the best efforts of developers. Home located by the water are most susceptible to water damage, wood rot and termites. Keep in mind that homes on wells and septic tanks need to be inspected and have the water quality assessed.
3. Hold back 10-15% of your renovation budget. Plan for the unseen and the unforeseen by holding back 10-15% of your renovation budget for emergency repair projects. Buyers are often shocked by the sticker price of repairs and retaining a portion for those repairs can lower your renovation stress level.
4. Hire the right contractor to do the renovations. True you may not be able to get Mike Holmes for your project but investigate local contractors and get multiple written bids for work to be done. Check with others who have utilized the contractors, see their workmanship and learn of their commitment to the project.
Bottom Line: Have a clearly defined scope of work to be completed. Hire the right people to do the work. Plan for the unseen and the unforeseen.
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