Buying a house is one of the biggest decisions you will ever make in your life. After all, with a mortgage, you are locking into a 30+ year commitment of monthly payments which more than likely will be taking a significant chunk out of your salary.
It's important and it's exciting. It's easy to make mistakes, especially if it's your first time so the smart thing to do would be to learn from other people's mistakes.
Rooftalks has shared 5 valuable lessons they learnt from buying a subsale property to save yourself from making the same mistakes.
You can read their original article here.
Lesson #1: THE RENOVATION BUDGET WILL INFLATE
Budgeting can be tricky when renovating. One lesson we’ve learnt is that the initial amount always goes up. Getting a quote from your contractor before starting renovation on your newly purchased home is necessary. But remember, the end total would usually be higher than the initial price quoted.
Paying more for renovations is not necessarily a bad thing. In most instances, we encounter a smarter way of repairing facets of the home or adding specific features that serve us better in the long run – these increase our costs.
For example, if you decide to put up a wall at the backyard, you may have that cost in your quotation. However, you will also need to add power sockets, a pipeline, and additional drainage – each of which may increase in number as the renovation progresses. Fixtures such as lights, fans, sinks, faucets, and fancy windows may not come under “renovation” costs but certainly add to your expenditure.
To save yourself some stress, plan out the major renovations first, such as structural (walls, floors, ceiling), electrical, and piping. A staggered renovation helps to ease your financial burden.
Lesson #2: ADD RENOVATION COSTS IN YOUR MORTGAGE
A little-known secret in the property market is to bump up your mortgage loan amount a little higher to support renovation costs. Of course, if your credit score is low, this will not work. However, when purchasing a property, inquire at the bank if you can add a renovation budget into your loan.
The last thing you want after buying a property to live in is to frantically search for finances for renovation and repairs. Having that additional amount of money to get work done in the home gives you and your family peace of mind.
Lesson #3: DON’T NEGLECT REPAIRS
So, you’ve purchased a subsale house and are eager to create your dream living space. The first step to succeeding is taking care of repairs. Yes, repairs are a bummer. But they are a necessary factor in understanding how your house works. From our experience, the older the home, the more repairs would be needed.
Essential repairs are structural damage and internal damage – these must be attended to first. Fix walls, pipes, leaks, replace all the wiring. Once that is done, go ahead and choose fixtures, design elements and accessories. You’ll have all the time in the world later to decorate and beautify your home to suite your style and design preferences.
Lesson #4: FOMO IS REAL!
If you watch MTV Cribs or Architectural Digest, please stop right now. What we see drastically influences our decisions in home renovation. The FOMO (Fear Of Missing Out) element is real when we look at other homes in all their glory. Particularly if our home is located in an established, upscale housing area, we may look to our neighbours as a benchmark for renovation design ideas – this is a bad idea. Here’s why…
When purchasing a subsale house, we most likely start renovation from scratch. Our neighbours, however, may have had a headstart in their renovation process. Many of them bought their houses brand new and have performed multiple repairs, modifications, and aesthetic changes over a couple of decades. Comparing our home renovation journey to theirs is not fair to us.
The best way to combat FOMO is to manage your expectations. Write a list of all the modifications you intend to make and KonMari your way through it – remove the non-essentials. Keep it simple and start off small. Your future self will thank you for it!
Lesson #5: YOUR HOME IS A WORK-IN-PROGRESS
Much like our life’s journey, our home is also a work-in-progress. As each of us is a unique individual, so our house is unique in its make and originality. We must keep in mind that the home is a place to bring us joy, safety, security, calm, and rest. When these feelings are threatened, then, it’s time to work on the home, and possibly, renovate it.
Along your journey, there will be times when change is needed. We suggest reviewing your needs in the home once every five years. Feel free to make some drastic changes. Re-style your home’s theme. Some modern styles we love include Rustic, Minimalist, and Bohemian. Consider some DIY home makeovers too so you can save costs while learning a new skillset.
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