7 Reasons to Buy Fixer Uppers vs New Homes for Your Personal Residence
I have bought and rehabbed 3 fixer upper properties to live in as my own personal residence. It’s definitely not as easy as buying a new house, but here is why I choose to buy fixer uppers instead of new homes:
- Equity - The main reason I buy fixer uppers is it gives me a chance to build equity into the home, that I wouldn’t otherwise be able to do buying new.
- When you buy a new home you are buying at retail prices, so the only way you can gain equity is through market appreciation.
- When buying fixer uppers you can ‘force appreciation’ by buying at a discount and making smart improvements that add value. My current personal residence was bought for $80k, and needed $75k in repairs, but is now worth $300k+. That’s over $100k in equity!
- Customization - When buying a fixer upper you get the opportunity to truly customize every aspect of the home and make the kitchens, bathrooms and finishes match your design style and lifestyle.
- Like New - My current personal residence has basically been renovated to meet the today’s building standards of a new home. My home has all new electrical, new plumbing, new furnace, new A/C, new kitchen, bathrooms, etc…
- Most New Houses are Cookie Cutter - Most new neighborhoods have 3 to 4 ‘cookie cutter’ floor plans in the neighborhood so every house on the block looks the same.
- Location - I want to live close to downtown Kansas City. Most neighborhoods within 5 minutes of downtown were built in the 1930s to 1960s. If I wanted to buy a new home, I would likely be 15 minutes outside of the downtown area.
- Trees - I’m not necessarily a "tree hugger", but I appreciate well established neighborhoods with large trees. Newer neighborhoods in the area barely have a tree in sight.
- Enjoyment - I personally enjoy rehabbing old houses and taking on the challenge of buying an old, run-down house and making it my own.