Does it need to be rewired? Does it need a new kitchen? Does it need new or partly new plumbing? How old is the heating system? It sounds like you could repair some of these things, but what if it needs to be redone?

I have looked at several old properties recently, but figured that a budget of $150,000 (on top of purchase price) would not be enough. I was looking at new windows, painting or cleaning brick, new HVAC, new electrical, mostly new plumbing, refinish floors, new kitchen, and upgrade bath. I am in Northeast and the labor multiplier is probably 30% higher than national average. I am passing on houses right now because of the renovation expense, not the purchase price. (one of the houses was not habitable, one was but run down, another some people would move in as is, but it still seems to amount to a similar budget)

A budget kitchen in my area is 20K and a budget bath is 7-10K., for comparison.

It doesn't need to be rewired, it already has been and has a newer electrical box. The only issues the inspector saw as far as electrical was updating the outlets in the kitchens and baths.

It has the newer plumbing but there are at least three leaks because it was left in foreclosure and some things froze.

The heating system is OLD and will have to be replaced, it has missing part. Those are the main things.

I'm going to just paint the old kitchen cabinets, put in new tiling and somehow fix the dropped ceiling. So I'm not going to completely remodel it. The baths will be expensive. But I'm going to hire help cheap and some under the table, the help of the local flippers who somehow have it figured out cheap as labor is cheap in this town - labor instead of contractors at $10 an hour...

In my opinion, it's not good to plan a budget based on broad, off-the-cuff estimates of what things will cost. You can count on most of them being way off in the end. You might find that you've spent far more, in the end, than $75K to make the house saleable as non-fixer.

You should also count on the need to fix many things that you are not even aware of at this point. Once you move in, and you start to demo, all sorts of surprises are likely. So that should be budgeted as well.

Lastly, as many folks painfully learned in the past couple of years, selling a house at any time, at any price, cannot be guaranteed. It doesn't matter how much you're willing to lower the price if banks are just not loaning money except to the least risky borrowers, and there aren't enough of those to count on. There's lots of other folks trying to sell as well, and their homes might need much less work than yours.

It seems to me this house needs lots of work. Are you sure it's a good one for you to start with?

If you haven't done renovation before, then consider that OJT is sometimes sobering, and if you find out the jobs you intend doing yourself are out of the scope of your ability, you could find yourself drowning both financially and emotionally.

My daughter and I renovated a home some years ago, but we both had skills acquired through experience. We also were working on a small, one story house where we could reach everything from standard ladders. The only thing we really needed to hire in done was install a new heating plant. We could have installed our own flooring, but the installation wasn't that much more included in the price, so we had that done too.

If I were a single mom with a little nest egg and were considering a place to live.....yes.......I would want to buy instead of rent. There are a lot of hidden expenses in purchasing a home you didn't have when renting, like real estate taxes, and homeowner's insurance and obligatory normal maintenance. It can add a substantial amount to your monthly budget.

I'm not necessarily nixing your house, however. But look at things you absolutely need to do to make it habitable and move in. That money will be spent immediately. I see a furnace, a roof, some minor (hopefully) electricals, some plumbing leaks, a water heater, and the steps (because your insurance company will insist that be repaired post haste). I suspect that is 15 grand right there if you're lucky. That's just to move in.

As for the rest, assuming it isn't a safety factor or a defect causing immediate damage, you can live with ugly bare wood floors, ugly walls, and antiquated cabinets and fixtures if they work and get to them down the road because that's what will happen.

I would not look at the home as an investment, other than the possibility that unseen major expense could take you over your head quickly and put you at risk of losing the house and any money you have. You can tackle cosmetics over the years but don't even begin to contemplate returns down the road. Think of it in terms as shelter, a home you could love, and know that it will take YEARS to make it come true and even though you might be able to make it work in your budget, lots and lots of money and most of your free time. Then make the decision.

It doesn't sound romantic, but in that situation, I would in no way ever borrow money to work on a house. You have the funds right now to put a good down payment on a modest home in good repair with a low mortgage payment. They're out there in this market BEGGING to be bought. Been there and done that with the situation you are in. Believe me, you would learn to love a more safe and sensible choice pretty quickly once you can call it your own and spend that money instead on less ambitious modifications. And.....actually find yourself with money left over at the end of the month and not have to worry constantly about a money pit.

No I'm not sure it's a good one to start with, wish there was others that were lesser jobs that I could move to this neighborhood. I live in a town that has some really rough areas and most fixers of course are in those parts of town. I have a boy and would rather fix a fixer in a better area then an easier project in a lesser area...

I just watched an HGTV show where they demo'd and fixed a basement apartment and I can see the shockers like the electric was unprofessional and more once they pulled down a ceiling. There's already signs that the electrical although updated wasn't completely professional like old wiring was left in the basement and in the attic.

I figure I'll live in the house at least 2-3 years and do various projects myself during that time span plus hire out what need be. I know about banks, that's why I got the house at this price because I had cash - makes me wonder if I could have bid even less as I don't buy the so called bidding war the realtor said - they always say that. Still at 40k plus even 30k I'm still coming out on the house. From what I see flippers spending around here it should work.

But true those who qualify and I was one of them - can be choosy about what homes they buy as there's much on the market. I don't think most people want to come home, plop on a couch and have a home already fixed up. But a realtor said it's about 25% who buy the older quirky houses and of course they are around here more affordable then new small homes. Or maybe more if they are really renovated.

Guess I'm not going to know the truth until I buy the house and figure this out... books, tv, info vs experience. So the worst scenerio is to take the 40k to buy the house, sink 30k into it, turn it into a rental for $1000 per month income and move on. I have an idea it'd make a good rental for a young family and at that price it's a good income property.

Actually, what you list as your worse case scenario is far, far from the true worst case. But it sounds like your mind is made up. Best of luck.

Yikes 15k grand for heater, water heater, roof, etc. But I didn't factor in the windows, ,some are in disrepair and will need to be fixed... so now what 20k just to move in?

Actually an old time investor told me if I bought an old fixer I could lose my nest egg from my personal settlement. He said to buy a house in a neighborhood I like and it's just a house payment - $400-500 a month here in my town for a decent house. He said he knew me and I wasn't the type to do yardwork and fix and I get easily frustrated. But I can't stand the idea of a bank loan either.

I had no idea the costs of windows on top of the heater and such. I really thought 20k was a fair figure to fix an old home, that's what I'd been told by a realtor friend and local investors. But what are they saying, that figure in 50s homes but not that figure in an older victorian with big windows and a steep roof and brick issues to cosmetically fix?

I wrote a list of pros:
- Has updated insulation in walls and attic, former owners used leap
- Has newer electrical
- Has updated plumbing - plastic and copper
- Great neighborhood meaning home will go up in value if fixed more then a bad neighborhood and in my town many neighborhoods aren't safe for my boy and I
- Lots of space for us and for resale value
- No signs of leaking in attic or basement other then by swamp cooler and inside from upstairs bath, minor
- The doors inside the house are good, close good, old cute, many old houses have crooked doors etc
- I hired an engineer and he said foundation is sound, this is huge in an old house
- Biggest really is the area, it's one of the few parts of town I'd live otherwise if I buy a house it'll be 20-30 min out of town in the country because I'd feel safer and schools. To afford an area like this it would have to be a fixer
- No 30 year bank loan, I have the cash to buy the house plus 20k in cash to fix and I could take out equity to fix more if need be
- I can't stand banks and being in debt, I'm debt free, not even a car loan right now

Cons:
- Cracked bricks need to be repaired for cosmetic reasons although foundation expert said house is sound
- Roof needs to be replaced, doesn't have gutters, is steep so will cost more
- I don't know about the sewer line
- Plumbing repairs, hopefully not to costly to fix, unknown until water is on and plumber will fix then
- Needs new heater, old one has missing parts, then remove duct work
- Gas line wasn't the right type and needs fixed
- Stairs in front of house need fixed, replaced
- Windows, did I even mention - is it true that the big windows can be 1k per window? I was thinking $200 per window but that was smaller windows right
- Carpets gross, all need pulled hardwood sanded, new carpets
- One bathroom needs major redo at least new vanity, flooring
- Another bathroom needs new vanity and tiling behind bath and flooring
- Kitchen needs remodel, at least cabinets painted, new tile, dropped ceiling replaced
- Laundry room needs new carpet and paint
- Walls need paint and texturizing throughout entire house
- Needs seed planted in front lawn, landscaping in back
- shingles on top of house need painted or stucco'd or something

It's looking like I could move in for 12-15k my budget to make the house habitable without windows or the front steps. Then as someone said, live in an ugly house that is slowly remodeled with time. I was going to budget the 1k per month I'd save in rent for 1-2 years. Figuring that was better then a monthly $400-500 house payment and I've been paying rent four years and am used to it.

The house is assessed at 95k, I'm getting it for 40k cash that I have on hand. 40k + 15k to move in is 55k. If the house was fixed up in this market I think it would go for 95k plus more like over 100k because of the area. I agree that it's all or nothing, that the house would have to be a long term investment and maybe source of major frustration. I work for myself only every other month so I have a month bi monthly with nothing much to do, so I have time. I know how to find the workers vs contractors to save money and go project by project - the help of some local flippers. Anyways I'm thinking I might still be able to do it - 55k up front into the house, another 1k per month x two years 20k of remodeling using affordable local help and figuring out much myself. At the worst I'd have to take out a loan for 20-30k more, and the worst scenerio if it's this is that what I should have gotten a bank loan and found a modest 10 years and under diinky house just out of town for 125k, boring cookie cutter house...

a. 55k + 20k (to move in fix heater roof etc) = 75k (house worth 95k)
b. Or 75k + another 20k more remodeling (scenerio) still house worth 95k break even.
c. Or 75k + another 30k (customize house even more take out loan) = house worth the 120k the inspector said it would be worth really fixed up because of historic area. So almost break even with much either frustration or enjoyment of fixing older house making it custom

I'm clueless if I'll stay or move up or on other then because of my boy I can't be moving around. Likely at least six years in this home, get my boy through grade school. Will my six year old learn from this, projects, having fixer upper guys around. He'll love the neighbors, the park, the location, actually he's disliked all other homes I've liked. I've been by 100s of them and ruled most out by neighborhood, even the ones left he hasn't liked as much as this one...

So decisions, decisions decisions. Can I really worst case scenerio lose all my money?

Breathe - found handyman to come by this afternoon to give a price on tearing carpets, sanding floors, cleaning, texturizing and fixing walls, fixing ceiling spots, tiling... his wife helps and they say they can do all of this for under 3k which is good. I thought just sanding and finishing hardwood floors would cost over that alone. He also knows about windows and can help advise to fix or replace them. I think I'm understanding that it's good to fix old windows and keep the character of victorian homes right? Anyways I'll know more by 5-6 pm tonight and will be able to crunch numbers better. Nothing like a good old experienced handyman who can do it all who's wife runs a cleaning business!

From what I see in my area, most flippers hire the cheapest help they can find, Flippers aren't willing to pay for repairs that will last for years; they need repairs that look good until the house is sold. Is this what you really want? Do you want workers who don't know what they're doing working on the home where your child sleeps? Will the work be properly permitted and inspected? Please be very careful! Yes, you could most certainly lose your money and end up with an unlivable house.

All real estate is local, so it's really hard to know. Not knowing any details, I would worry that while the immediate neighborhood is great, it is part of a larger area with tough neighborhoods. Neighborhoods can change pretty quickly - for better or worse. Depending on how your school district is structured, the school may draw from all parts of your town, including tough neighborhoods.

I'd worry whether you could actually get $1,000 per month rent on the house, since you could buy it for a mtge payment of $500 per month. That's not the usual relationship between rental vs ownership cost, even with a big down payment.

Reliance upon the $95K figure of course is no guarantee. In some markets, the $120K house bought two years ago could be worth only $80K (20-35% decline over two years). I think the market where I live is improving, but the possibility exists for the market to just continue downward.

You are self-employed, but only six months a year? I'd worry about continuity of income. Just normal upkeep on an old house is a huge drain on time and bank account. Plan on everything costing double what you expected. Plan on everything taking twice as long, creating twice as much mess, and consuming all of your spare time that would be spent on fun family activities.

If you still want the house after considering all that, you're probably an old-house-fixer-upper for life! Best of luck, and let us know what happens.

If you bought it at auction, and are paying cash, and the last owners lost it because they couldn't afford to live there....be very careful about things like utilities not paid by previous owners (yes, in some places you will have to pay any delinquent bills to get services turned on), taxes against it, asbestos or lead present. Buying fixers with cash is a fairly common practise here for flippers, because nobody is nosing as a lender to see if it meets codes, etc. and you take the house 'as is'.

No gutters? That might be something a code man will getcha for immediately. Things to do to improve drainage? Do you have a wet basement or worse yet runoff to an adjoining property? Are the utilities on so that you can check to see if the water lines are notoccluded, or if the sewers don't back up when you flush? Or whether there are gas leaks? Those are all big, big ticket items to excavate and work on underground pipes. Stucco on a tall steep sided house? We paid nearly 20K seven years ago to have our old house restuccoed, a thousand just to have the skyscraper soffits and trim painted, and another thousand to gutter it. I could gutter a single story house myself.

We've been working 25 years on our old house, lol, and it ain't done yet. Tax assessments are based on formulae and school districts, and how many 'stacks' and baths you have and not necessarily on what your house is really worth, and certainly not what you might be able to sell it for in a best case scenario.

At the end of the day, regardless of dreams ( and those sometimes have to be deferred ) what is best for his security with the resources you have at hand is the right answer. Whatever you decide, I wish you luck.

Do you have any pictures? When I was looking at a house, I posted some pictures so people could give me a bit of feedback based upon what they were seeing. My tentative budget for a sound house that needed new HVAC, kitchen, electrical, new windows at least on the front facade, and a lot of cosmetics (it was a large intact 19thc. rowhouse with no remuddling) was $150,000 and most of the feedback was "no way is that enough".

Am I sensing here a desire to return to a gentler time in your life? After a divorce in which you walk away with a few thou bucks, your freedom, and your child, I can see that you might choose to look for the known peace of your childhood.

BUT.....This is not reality.
Find a newer reality. Go to the place a few miles away which is new and different in your experience. If you get a preapproved bank loan, and you pay on it doubling up or pay twice a month, that loan will not still be with you 30 years from now.

Be very very cautious. If you are doing this move because you envision your child going to school and having the same sort of childhood experience you had, it just is NOT going to happen. But you won't learn that until you sign your money away, and then you are stuck.

Make a new start. Don't go back to another time in your life. You can't go home again, as author Tom Wolfe wrote many years ago. Good luck, and peace be with you.

I don't see how to attach pics here but only to link to a website is that right?

I had the handyman come by today and he's not even licensed in my state he moved here from another state whining about the city wanting to steal from him so he didn't get licensed here. For what he wanted I'd hire a licensed contractor. But from what he said at $20-30 bucks an hour that he'd charge and he wouldn't give me a firm amount on anything, to pull carpets, sand floors, texturize walls, fill a few cracks, fix a few ceiling issues, retile two bathrooms and the kitchen, fix the countertops in kitchen, paint trip, paint house, fix windows (not replace) and a few other odds and ends it's going to be 8k. Then I'll have to put in carpet on the stairs and upstairs separately. And if floors don't look good swap sanding for laminate floors. Basically the house looks good compared to most I saw and rather then spend 8k up front, which from how he was waffling it'd be 10k I'd like to find a worker who'll charge me by the hour that I can work along with and try to learn myself and do some things myself. This is all cosmetic stuff.

I told him the priorities would have to be the roof, heater, water heater and electrical getting appliances in, plus the gas line issue. That itself is going to total it looks like 10-12k which is my upfront costs besides cleaning, disinfecting, tearing out old carpets to move in. Some of the ugliness I'll just have to live with and go room by room renovating. He got upset with me when I said I'd have to do it all with time, stomped off. His wife was embarrassed as on the phone she told me they could paint, texturize, clean floors, sand floors and etc for just 3k as they just did for their "friend." She was mumbling something to her husband as they left that she shouldn't have told me about the buddies house in so much detail. Anyways bought handyman book on how to do more myself.

When I said I"m self employed and work every other month that doesn't mean the income is from just every other month. I've run a business since 1993 that's quite stable. I'm debt free, not even a car payment because I did the Dave Ramsey program a few years ago. The income comes as customers pay me for a product I do every two months. I don't see my business going down, and if anything really unexpected happened I'd take out a loan on the house - I'm paying 40k cash for the house plus I have another 20k cash set aside to fix it now, then 1k per month in repairs in my budget - figuring out as much as I can myself.

The house would actually rent for about $800 per month, maybe $900. When I said the payments wouldn't be very large that was because I have so much cash to put down on a house. If I had to finance a house the payments would be more of course with just 20% down. I want to live debt free, that's my goal. Even if this house isn't pretty at first I'd do what I have to do to stay debt free. I have no other bills except utilities, taxes, insurance etc. and I get 1k per month in child support on top of it from my ex. So financially I feel I'm in good shape, I just want to avoid debts and banks - thus my reason to want to buy a fixer and fix it with time rather then a mortgage. But maybe I'm off, I guess I won't know until I'm in the middle of this.

As for today I think I could shave the number of 8k he gave me in half by learning to paint and tile and do some things myself. Or just bid by job a bit at a time to workers rather then contractors that I know do good work on painting tiling etc. I do know a handyman that's retired that said he'd give me a list of guys who do work and are quite good and reliable for at least half of what this guy would charge me. Since it's a recession you would think that they'd be wanting some pay. Many are out of work.

Now tomorrow I'm going to get a bid from a roofer, heating guy and plumber. Of course until the gas and water is turned on there's stuff I won't know. The inspector wouldn't turn the gas on because the heater is old and is missing parts. He said I'd have to replace the heater but he said the gas lines weren't up to code and would need to be fixed. Is that scary? Then the water heater is old and since the pipes were broke at the main it couldn't be tested. The house was pressure tested but couldn't hold pressure because of at least three broken pipes. There's no signs of broken pipes throughout the house and since it's been vacant so long I'd think the walls would be cracked etc showing damage - I've seen that in vacant homes.

I don't know about the sewer lines or if toilets flush because again because of broken pipes the water coudln't be turned on so there's some risk right? Or will a plumber do a scoping prior to my finalizing the house? What would he charge? And can they? Because I know someone who had a broken sewer line and it cost 6-8k to fix.

Yes the house is a foreclosure and no the old owners couldn't afford to fix it and I can see why - people buy fixers and wouldn't dream of 20-30k in repairs and then more falls apart while they live there. it's common with foreclosures from what I can see at the assessor's office. Truth is banks shouldn't have been giving loans for fixers like this house - in need of such repair. This town had corruption on top of it, recently four appraisers lost their licenses, one went to jail, six mortgage people are going to trial and the fbi blasted through the local banks because of flipping schemes in this town. This house though was owned by a couple who went through a divorce, story is the husband kept the house, had to pay off the wife and child support and went broke. He moved out of the house over a year ago, abandoned it. I don't know if he tried to sell it on the market. He told a relative he could live in it for free if he could fix it. Neighbor says he couldn't get the water on and he was broke too - obviously he couldn't afford the 20k to fix it. Likely since there was hail in this town, the man took the insurance money and didn't fix the roof - there was a lot of insurance fraud last year. Many took insurance money, or equity out of houses and those are the ones being foreclosed on to the tune of hundreds of properties. Many investors are losing 10-20 homes at a time because they didn't fix them, the slumlords.

I can tell someone loved this house. The original lady especially, she had it built then built more homes on the same street. The foundation is solid and sound like the neighbors built by her. It's a very cute house, great staircase, huge living room, tall ceilings, upstairs are two loft style rooms and a bath. From what I learned today even the cosmetic work isn't going to be as bad or cost as much as I think in the long run even doing a little at a time.

I know neighborhoods can change but in this town it's more the lower end neighborhoods that are changing - because landlords are buying homes under 800 sf, this home is bigger and more expensive then what they want. They focus on certain areas and this isn't one of them. True about the schools though -because I was already told they shut a school down on a lower income part of town and are busing kids to this very school, a mother I know complained about it but said the school is still a good one. This town has a lot of charter schools and magnet schools as well. Plus there's a good private school nearby if I don't like this elementary school. It's a strange town, there's parts where it's really rough, other parts where people love to live like this part, and two others, then there's some mid neighborhoods. I was told to look at neighborhoods hard because there are so many rentals, find an area with few rentals, good schools and that I'd be better off with a 100k valued house then less because those parts of town will hopefully stay solid.

I need to get a heating guy in, plumber, and roofer to get bids next right? And then if I can't figure out the septic I'll have to risk it and at least I can really crunch numbers after all of this -keeping in mind this is one of the many zillions of homes I looked at, one of the few I really like, one of the few neighborhoods I'll really enjoy and feel safe in, and that I can't stand cookie cutter homes and bank loans... A friend said if I do this don't do it for money as likely I'll go in the hole. But realize it's to built a family home that's mine and me. I can't do that with a cookie cutter house - I just don't like them or the areas they are in. They aren't for me. This old house, I like it a lot. Thanks all for listening to me. If I can post pics or figure out where to online with links let me know. I have a bunch

Lots of options for posting photos, but one that is popular is photobucket - see link below. NOTE: say 'no thanks' on second screen to get a FREE photobucket account -- you don't need photobucket pro.

Then upload photos from your computer or other source. When photos are uploaded, if you hover over an image, three choices appear. Simply click on the URL choice, copy it, and paste into your message. There's a TEST forum on the landscape forum section where you can test that photos are working before you do 'for real'. If photos are too large or take to long to view, you can change the size in photobucket.

Here is a link that might be useful: photobucket

As for your general thoughts...

Living debt free is great.

Buying a house you can afford - for cash - is great.

Assuming you can flip a house for profit without doing most of the work yourself - highly suspect.

Assuming 15k for MAJOR repairs - highly suspect.

If you are going ahead with this, make sure it is someplace you want to live. You could be there for a while. Make sure it can be livable (not pretty, but livable) on your tight budget. A roof might be 6k, but if they find anything wrong as they start ripping the old one out, that could turn into 10k. A new furnace/line repair could be 5k. Plumping and a water heater will probably be at least 2k. That is pretty much all of your budget and you haven't addressed your laundry list of fixes. That might be OK if you are willing to just do $1k of projects a month for the next several years.

"gas lines weren't up to code Is that scary?

pipes were broke at the main it couldn't be tested. The house was pressure tested but couldn't hold pressure

I can't figure out the septic I'll have to risk it"

Learn how to paint?

15 thousand dollars?

Oh My Gawd. It just keeps getting deeper. I am beginning to wonder if we aren't being trolled.

Calliope, I'm right with you! I'm doubtful that anyone is this naive.

To call a 105 year old house a 'fixerupper/handyman special' is more than a stretch in the best of situations, but when you're obviously NOT handy.........

Scenes from 'The Money Pit' keep running through my mind!

The house fixer-upper memoir is one of my favorite book genres. I've read at least half a dozen, but the only one I can think of offhand is 'House: A Memoir", by Michael Ruhlman. I read 'em and enjoy them immensely, but there's no denying some schadenfreude. The people always get in WAY over their heads, and without resources such as high-earning spouse, it would be certain disaster. Even the 'good' endings result in the owner loving their house but knowing they could never recoup the money they have put into it. Personally, I'll live vicariously, enjoying the books, but not risking what money I have left.

I don't know about the OP who may just be thinking out loud, but I don't like the handyman :-)

Assuming it's real, for me the bottom line is, could you live in the house as is if necessary or with only repairs that are strictly within your budget, and could you get your money back if you put it on the market at any point.

Looking forward to pictures.

KarinL

I found a plumber, he's estimating under $500, likely less, for the broken pipes which should be in the basement. He said if there were issues with the sewer line it would be about 3-4k but the neighbor said there's never been issues with the former owners who moved. I could pay a guy $150 to scope the line prior to my inspection deadline this week.

Heating guy on the phone said anywhere from 2-4k for the heater replacement, and he's going to come look and see what it is. Water heater about 1k to replace it. Swamp cooler, haven't gotten more info on this.

The gas line issue, the neighbor showed me the work she had done, it's just a matter of newer gas lines by the heater, I need to ask the heater guy about this when he comes out. My builder friend said it's that they are older and don't meet code.

Still trying to find a roofer to come do a bid. I don't know why they don't return calls but asked neighbor if she knew of someone honerable and she did so I'll call. Yes it appears the roof could be up to 10k because of the boards under the roof needing replacement.

I'm figuring it's true, I'd have to be really strict on the budget, get many bids as the neighbor gave me stories of being taken for rides. I'll have to work hard to find the right handyman and ask around more as this last dude was bad. Trouble is I told him I got the house for a steal and had a certain budget to fix, of course he wanted half the budget. I'll have to maintain control and bid out various projects myself rather then hiring a general contractor I can see. I'm learning a lot and each person that looks at the house and gives me bids teaches me more at least.

So 15k for the roof, heater, water heater, pipes to move in. Then the rest of the house is cosmetic. The handyman wanted to do it all overnight and stomped off because I said maybe he could texturize and I'll paint. So next guy I'll say my budget's very tight (nothing about cash or anything per neighbor's advice to never say I have money, even park nice truck a block away) and all I want done is patching a few cracks and texturizing. I'll figure out what I can, hire out what I can't figure out at a budget of 1k per month for a year, two?

It's true that I'm naive but I love to learn and I enjoy researching. While married we owned newer homes that didn't need much work or repair. I did grow up in an old farmhouse so I know I can figure it out and I'm not so niave to think there won't always be "something" as that's how I grew up. I don't think I'm trying to go back to my own childhood but true I want a safe nice area for my boy and a 'real' home instead of a cookie house, I"m quirky, a realtor said that 25% of the population is like me and likes older quirky homes too so I can resell the home.

And yes even if I put 40k cash into buying it and another 30k into it I could resell it at 70k in a heart beat. I saw on craigslist today the home that a local flipper bought not far away on a busy street, mine is a better street. He got the house for 32k at auction. I went into it before he fixed it as he was trying to sell the piece of junk prior to fixing it because the layout was a mess, the foundation a mess and the siding too. He stucco'd it, remodeled the kitchen, put in tiling, paint/texture, new heater and he's got it listed for 85k. He always buys under 40k tries to put less then 10-15k into a house. My house on a better street, with a better layout, more room once fixed up is worth more then his hands up.

I actually studied the local market quite a long time, especially tracked local flippers to see what they were doing and what neighborhoods they'd choose. Most make 20-30k profit per house, they hire crews and don't even do the work themselves. Sure it's the cheapest cabinets, heaters etc and this one I'll live in... but I've been coached too by some realtors I know, one's son flips homes for a living. Another buys them himself, he told me what to look for as for neighborhoods and price range for this town I'm in. I've driven by hundreds of homes, looked at dozens over a six month period. So this house doesn't spook me so long as I control each project, learn and don't get hosed...

However I've learned how little 20k cash to fix a house is, still in talking to my neighbor today who's a contractor of commercial buildings, he said I could do it if I learn how to paint etc. And I'd have to get bids and really sort through companies and references and be careful... he was grumpy because of the bidding wars with his competition in a down economy himself though. I have a very good builder friend too, he's a few hours from here, but I thought if I do hire workers instead of contractor's like the flippers help - then he could come on weekends and supervise that things are being done correctly and he'd do this for me. Problem is I wouldn't know. He'll help with the deck and some other minor repairs but he's busy...

Thanks world for listening to me.

I keep seeing the word 'flipper'. I'm not sure there's another word in the English language that causes me as much anger and annoyance. These people take houses with charm and character and ruin them with tasteless, cheap 'renovations' all in the name of the almighty dollar. I can't tell you how many lovely Craftsman homes I've seen ruined, tarted up with carpet and granite and stainless steel appliances. For the amount of money the buyers end up spending on these dolled up disasters, the house could have been lovingly restored, but instead period details are destroyed, plaster ripped out, etc. etc.

Please don't use anything these people do as a metric for, well, anything. I have been holding my tongue as I am new to this board and a new homeowner, but living in the Seattle area and trying to buy a house for three years (Three years!! And we spent almost 200k for our fixer! And yes, it is a fixer, no furnace, rotten carpet, etc.) I have a healthy dislike, verging on hatred, for those who profited through the real estate boom/debacle at the expense of so many beautiful old houses.

This isn't a criticism of you, just of 'flippers'. Also, being 'coached by a realtor'? Seriously? Realtors do not have your best interest in mind. I am reminded of a rental I had where the landlord explained that he was sold the property by an old friend. Well, the old friend soaked them for half a million for what was basically a shack. In this market, they'd be lucky to get 200k. I wonder if they are still friends?

This is like asking a used car salesman which car to buy. Maybe you should consider someone without a vested interest?

That said, your enthusiasm is great. Post pictures already! Preferably pictures of the problem areas.

I just noticed you said $150 to get the sewer line scoped. That's one thing I wish I would have done, although it would cost me $300 here. I would have asked the bank to hydro-scrub the sewer main, which as it turned out was blocked with roots.

This is news to me since all I've bought is new homes. I was looking at home buying as a way to make money, I know a lot of realtors in various parts of the state because of some business I do so they aren't vested in my making money or not in a home in this town. In the process of house hunting I started disliking the local real estate community here, no they weren't being helpful, they behaved like used car salesmen and I filed complaints against a few.

When I learned of how crooked the local flippers were I sent information to the state paper too, who had written some stories about the con artists who took advantage of the underprivileged, selling over priced homes to people who did far less research then me. If I had bought a home early on in my house hunting, I"d have been ripped off. Now six months into the research at least I'm armed with knowledge of neighborhoods and etc that the current realtor could honestly care less about, nor did any before her.

When the fbi blasted through this town I think they should have thrown some of the local flippers in jail along with the appraiser and mortgage officers. Business is business but years of ripping off buyers for the almighty buck is sickening. With a limited budget I feared losing my nest egg so I continued to research what they were doing. Honestly I didn't think about the end of it - of the historic homes, I thought as a realtor said that actually fixing some up that are sitting empty, or lost to foreclosure because of the flipping fraud in this town - would be of service for those who don't have the cash, as I do for a fixer, but could afford even this house once fixed up.

I'm sorry about the historic value of homes being lost but the truth is that there's little economic sense to buying an abandoned home for 40k and putting more then 20-30k into the house worth 100k in this town. If there's no economic sense then business people wouldn't buy such homes to profit - and they'd continue to decline. Have you seen what these old homes look like, like this one, after being vacant a year in foreclosure? What's the worst of all evils? My studying how flippers figured out how to hire affordable help at $10 per hour vs a handyman's $30 per hour vs a contractors $80 per hour - to salvage these homes?

Me I can't afford to buy a home and fix it for historic value, I don't know who can do this as a money losing hobby? This town where I live is strange, because homes are so affordable outside investors came in and did buy many of the historic homes turning them into old homes with cookie cutter fixtures, cabinets, carpet, tiling, etc. Local investors too. Many own 10-20 homes here, it's not uncommon. When I first started thinking I could buy a few rentals a banker said when I run into those 30k homes think "why not?" I was shocked as I didn't know there could be such a thing as a 30k home that was habitable.

What's going to happen to the hundreds of foreclosure homes hitting this town, if the local flippers and investors didn't buy them - and someone like me didn't take the "risK" they'll deteriorate and be condemned rather then be bought at all. Economically I'm not sure buying an old house makes sense. I found this old house forum and asked is it worth it and it appears most think no it's not... so what are the consequences then? Will landlords and flippers take over these homes at half off what they are now because even at 40k I'm not sure these old homes are deals? And even if they are "updated" in ways historic people might not like is it better then the homes being bull dozed?

I grew up in a historic house, my mom to this day is cussing out that house. Rich people with real money bought the house and turned it into a show home. It was a beautiful falling apart victorian that about bankrupted my family, if it wasn't for a small inheritance the home will have caved it - it had to be hoisted up. The Californians that bought the house ruined the character of the house, I've never been back inside but we've heard that it's not even a historic home now. Is money the root of all evil? And is the past the past? This is all news to me, I haven't thought about old homes since I was a child really, it's because I'm a poor single mom that I've gone to obsessing about fixing one up - so I'm clueless about how to restore a home to historic value or how to at all. If it's to be a hobby that costs me my money I'll have to find another...

http://s756.photobucket.com/home/frontier333/index

Here is the link to pics - photobucket.com and my username is frontier333 but the pictures aren't very good

You might be able to get the house in legally inhabitable condition for your budget, but I can't see stretching that budget to make the house look much different than it does now, its going to be a livable house with problems and run down condition.

I am looking at properties that are worn out but not distressed (legally occupied, old systems that will need to be replaced but have repairs that are under warantee), and am adding up estimates that top $100K. (and 175K to really do it all up as a "restored" house.)

Are you sure you can't find something in better shape that $40K would be a large downpayment, and you would have a small mortgage and money left over each month to tackle smaller projects while you lived in the house?

If it's to be a hobby that costs me my money I'll have to find another...

Honestly, I think you better "find another". It will cost you money. There is too much to do to this house, to do it right and still make money.

It could be a charming house again, but it would take a lot of work and MUCH money to both get the mechanicals in good shape and restore it to it's former charm.

I know you really are not in this for true historical restoration. And I understand your dilemma about whether such houses will be lost to the bulldozer, and perhaps it is better for someone to at least make them liveable and sellable - versus our admitted penchant for historically sensitive restorations on this forum. Your point is something to think about. But, it really does seem to me that given your financial philosophy and the amount of cash you have, you'd be better off in a house with fewer problems and less chance you'll lose your entire nest egg. My guess is, you will lose it.

Some people really see a house as a long term home, and worth investing in because of the comfort, joy and yes, pride, they take in their home over the years. Maybe someday, you'll be in a position to arrive at that place.

If I were you, I'd try to find safe and affordable, move-in livable shelter for you and your child now. Save and invest your nest-egg in a better investment than this house.

Best of luck, and I hope you post photos as you go along -- I'd love to see your progress! The house is charming, but more modest than the row house palimpset posted, so presumably your budget would be more modest as well.

The house is not loaded with architectural details (notwithstanding that cool windowed nook at the top of the stairs), so concerns about destruction of architectural detail is largely misplaced. Basically, I think you would try to maintain an historically accurate exterior, and do whatever makes economic sense on the inside. I agree with your concern about bulldozing older homes. I hope you will enjoy the process of restoring this one.

I should again reiterate that my criticisms were not with you, but rather the concept that houses are an investment whose value will always rise, and that buying low, making improvements with a mind to profit, and selling high is a recent and to my mind unhealthy concept. But it does not seem as if you are caught in this mindset. I can also see your point regarding investors vs. complete decay.

Good luck!

"people I know in the business say if I do a lot myself and learn, plus hire handymen per project - and laborers there's almost no way to lose."

Those are some famous last words. Best of luck. Maybe you will be the first ever to finish on time and below budget while repairing an old house. There are a lot of things that can (and often do) go wrong though, so you should hope for the best and prepare for the worst.

Calliope and Bill nailed it.....and I would know. I would pass and look for something newer.

I bought an old farmhouse last year. I knew it had issues, but not this many issues. Now the house consumes 110% of my time plus weekends. I'm in no hurry, but I'm I've come to the conclusion it'll be a few years before I can spend a weekend watching TV instead of going to HD or Lowes.

Right now my job is one traffic light away from work. That's really the only thing keeping me sane.

Good luck.

The house I am budgeting now is 2100 sq ft vs. the big one I posted before @ 3300 sq ft. I don't have pics of the latest one.

So how would one do "character" outside the house - yes it's a modest house without insane detail I see sorting through other posts here. This has always been a working town, homes were built originally for the market here rather then as they might have been in a wealthier city.

Frankly I don't care if anything happens on schedule I work for myself and have a lot of time on my hands, every other month with little to do. Work has always been a hobby to me, I'm used to working more then I do now because my business is established so I need a second job and why not work for myself on an old house?

Does it matter that I'm naive so long as the numbers are making sense. Other then this site I haven't found anyone in the real world - my builder friend, a friend who studied construction management, realtors I know who can figure out how I can lose on this home. But real estate is local and I'm sure this town doesn't make sense in the real world either. This town has it's own set of rules, many outside investors avoid it, I spent over six months studying the market, with paperwork to the ceiling and back to the floor.

I think it's odd that there's so much pessimism - I don't know what life would be without a risk. What taking someone like me who's traveled a lot of the world, who's run a company since 23, who's not the type to live in the suburbs (tried that house on the hill thing and it wasn't me) and saying it would be "more fitting" to buy a modest cookie cutter house. They are all the same, they just move the kitchen here to there in one home, the garage east rather then west... does it matter that I'm quirky, does it matter that the fixer is a modest fixer without much historic value?

I don't know what this is, didn't realize people were so into historic values of homes. I grew up in one. It was a money drain, double the size of this house with far more issues starting out. it had to be lifted, cranked up, windows put in, everything... I grew up poor in that house that is now called "victorian" and then one day the rich people wanted to live in a house like that. Before only poor people lived in those homes. So apparently something happened from my childhood to my early 40s and I'm still a bit stumped. But I'll soon research more and will find out what all of this is.

Yikes I sure upset a lot of people, I'm still scratching my head as to why at an old house website most people are against someone wanting to on a budget fix up an old abandoned house who has cash and time on their hands. Maybe not enough but with good enough credit to get a loan - I must have come across as a complete nutcase. I'm sorry for that. Guess when I started this post I was in panic mode. I like the house, my gut is usually right in life and I enjoy risk. As a realtor friend of mine emailed today - everyone wants a risk free investment - life doesn't work that way... why do you think I got the house at a steal because it's an obvious risk, if it wasn't and it was fixed up it would be double the price if not more. It is what it is - if I wanted some huge historic house with more detail now that I know more I guess that's what I'd go find.

I like the simple life - I'm not an ornate person, I've been to third world countries and I don't believe in huge American homes - it's not for me. I want to live debt free - and you know what, if people for thousands of years lived without heat, without this or that that we might consider to be necessities in our "homes" and that over half the world lives in poverty compared to us... maybe during these hard times it is actually time to go back to our roots? And to the person that criticized me for wanting to go back to a family home, to my roots, to live in my means - heater working or not - maybe I represent something. I didn't make a mistake and buy a house at peak, sorry to all for profiting off of these times. I think I found a freakin' good deal for my boy and I and after sorting through hundreds of homes I'm going to take the leap - life will go on... if not I'll cut my losses and without losing my shirt.

"I think it's odd that there's so much pessimism - I don't know what life would be without a risk."

It's not pessimism, you are talking to the voice of experience. We've all been there and done what you are about to do. It's called pragmatism.

"What taking someone like me who's traveled a lot of the world, who's run a company since 23, who's not the type to live in the suburbs (tried that house on the hill thing and it wasn't me) and saying it would be "more fitting" to buy a modest cookie cutter house........Sorry for my philosophy,'

You are the one who asked our opinion. We simply gave it. You don't have to be sorry for your philosophy. It's my philosophy too. I also have lived on several continents and didn't grow up in the American Culture. I also believe in being debt free. I think buying a house is a good thing for a single woman. I also bought a house as a single mom with smaller children. I also fixed it up. It also was a hundred year old home, as were the four more I bought and fixed up and lived in. I also paid cash for the last one and I didn't have to borrow money to renovate it. I also own my own business.

The difference is. I can plumb, I can wire, I can plaster, I can run a saw and I already know how to paint. I have done the dance with contractors, I have lived as an adult in old, old homes and know what lays under the siding, and the roof and behind the walls. I have replace a septic system that turned out to be two 55 gallon drums. I have had asbestoes remediated. I have heard handy men brag about how they can fix something cheaply and then never showed up. I have repaired code issues. And when I went into my first fixer upper I bought at auctions, I had a father who could tear a house down and put it back together blindfolded. He recommended to me what we recommended to you....start modest with a smaller home. It doesn't have to be a tract home in a cookie cutter location. It just shouldn't be a huge old house with the potential for major problems. My ex just laughed and called me fearless and I am a risk taker and I've either been very lucky or blessed, because I pulled it off. I sincerely hope you can too. The difference between us is that I deferred my desire to go for broke the first time around and settled on one without so many potential problems because I had two little kids and the buck stopped at me. So, as my experience and skills improved I moved on to more challenging houses. I am in the one now I wanted when I was your age. It took me a few years to get there. That's all.

I don't think anyone is projecting that you would lose money if you pay $40K on it and can get it in a livable state for $25 or even another $40--if you Sell it, you will get your money back. Living there on an ongoing basis and living completely debt free? That is a different story, that house appears to need enough work that you would need to have loans for some of the projects unless you give up everything else. My sister had a plan where she was going to save $500 a month until she had enough replace her literally falling apart kitchen. First of all, to get a Basic kitchen in her area she would have had to save that every month for four years. And how many times did she need that $500 for something else?, often.

I think you are misreading the (hard-won) advice we are trying to offer you (at your request).

You seem to have made the assumption that you will be able to pull this off using mostly cheap "handyman"-type labor.

Sorry but, I don't think that is a viable, or likely, solution. Since you acknowledge that you don't have much experience at this (that's not a deal-breaker, most of us started at the same place as you are now, with the exception of the few pros who post here) you will wind up relying on the handymen for technical expertise. If they had that kind of expertise in the care and repair of old houses they wouldn't be handymen, they'd be higher-paid tradesmen. Your friend with construction experience won't be able to remedy this if he's only available occasionally, and it will set up all kinds of unworkable supervisory dynamics if he's not clearly in charge.

The reason why cheap labor works for flippers is that they generally have more experience than you have now and also they don't really care if the work is a good value, just that it looks nice enough to pass muster for a quick sale.

I think it's great that you have time on your hands to take on this project, but you need to face the fact that it won't work unless you, personally, have either the money to hire real tradesmen or are willing to step up and learn the unique skills necessary to care for an older house. I'm not talking about fine historical restoration-quality work. It's just that many, if not most, quick and easy home fix-up solutions don't really solve old-house problems; they just are a veneer to cover up the problems. OK for flippers, not really OK to spend money on and have to live with the results. Please don't confuse cheap (low-cost) with inexpensive (good value for the money).

Also you seem to think you can just "bank" your current rent payment and apply it to fix-up projects instead of paying it to the landlord. It doesn't work that way. The erstwhile rent money will go towards paying for routine upkeep, taxes and insurance and utilities and furnishing and caring for the house. So you'd better have another source of income to save up to apply for project costs. You aren't the first person who has made this assumption but we have all learned it doesn't work that way. You can either believe us, or learn the lesson on your own.

You are an adult, and quite clearly, a resourceful one at that, so we aren't trying to bum you out, or dissuade you. Just trying to help you make your back-of-the-envelope calculations more accurate. In the end, of course, you'll do whatever you've a mind to do. And if that's carry forward with project, please come back and ask for more help about the technical details as they arise.

One thing I will note however, is that you seem to have a curious love-hate thing with old houses. On one hand they seem to appeal to you (quirky, different) but you also seem to have the impression that they are money pits that breed misery for their owners (your description of your childhood home).

I don't think you'll be happy in an old house unless the pleasure from the quirkiness is greater than the cost (time, focus, money) of owning one. The one absolute truth about old houses is that they are not the lowest cost solution to the need for housing.

Even if your goal is essentially serial home-flipping as a financial tool (leaving aside whether that still is, or ever was, the road to financial success it is/was claimed to be), if you don't know how to do, and enjoy, the jobs this will require you to do, you will be miserable and desperate to escape. That's why some posters are urging you to start on a less challenging project that would allow you to test your tolerance and capacity without so much of your capital at stake.

Leriodendron, you said it all so well. I gave up a while back.
I wish her well.

In a word, NO

In a bit more detail, have you ever lived in a home under going a remodel? They call it "divorce dust" for a reason. Married or not, the term still applies.

You have to be out of your mind to be willing to live in a house that is having any kind of updating or remodeling done. Absolutely crazy, just like everyone of us that has, is, and would do it again.

When it comes to a project like you are discribing, you have to be able to see thru the dollars and cents, because you will never have enough of the dollars and what you are attempting to do makes no sence. You can not "FLIP" a 1905 fixer. If you could it would have been bought before you even knew it was available on the market. The realtor would have "bought" it, flipped it to someone they know who does construction flips, who would have flipped it to someone who does finish flips, who would have flipped it back to the orginal realtor, who would then sell it agian.

All that being said, that doesn't mean you can't make money off a 1905 fixer, or any fixer for that matter. In reality you can actually make more than the above mentioned scenario, and A LOT more at that. The difference is, what I outlined above happens in 30-60 days, your money will come back to you in 5-10 years.

Now here's the catch. If you do all the work involved only with your eye towards the money you will make, you won't make a dime. If you do all the work involved making something you would be willing to die for before you ever sold it you will make your fortune.

Oy vey!

It doesn't sound like you had a very good inspector or else he/she could've helped you come up with a complete to-do list, with ball park estimates and advice as to what you can do yourself, or who you might hire to do it for you.

IF YOUR INSPECTOR DIDNT DO THIS, then quick, pronto hire another - it will be $200-400 well spent - this time interview them over the phone before hiring them. and make sure its someone who likes, and specializes in old houses and old style construction methods. You can generally tell who these people are by talking with them for 15 minutes -old houses are their passion and they enjoy talking at length about them. A lot of house inspectors arent all that knowledgeable about old houses and are coming at it more from the angle of what the bank will approve and what won't they.

It is really pointless to try to give you advice without us being there to see the house or to really understand what you're talking about. If youre looking at it like a flipper, well that's what those guys do - rip out everything and throw it back together using cheap cheesy modern methods & materials. That's how they make money - they've got it down, they can do it fast and cheap. Whereas a true restoration, that takes ingenuity, time, research,and no small amount of creativity. A flipper is not going to do that, generally, because, its a very time consuming labor intensive approach. But a homeowner living in their house may be able to do it quite easily over time.

You say things like windows needing replacement but what does that mean? Some people think a few broken ropes and minor wood rot means it has to be replaced whereas that actually is something quite easily repaired by homeowner. Or it may mean your windows are so rotted they literally are disintegrating - in which case then yes replacement or rebuilding of sashes is probably the way to go.

I just cant say whether you should get out or stay, simply because its unclear to me how much of this is work that is really do-able by you and how much isn't. If the house is liveable as is, Im inclined to say stay and give it a go - at the very least you are saving 1,000 a month, hey?

I don't think you necessarily have to have ALL the skills right now - you can learn as you go along - but I would say SOME basic carpentry (sawing, screwing, nailing, accurate cutting) & a proven history of having done things like set tile or whatever - would be a good indication that you have what it takes to make it work!

PS - only a few days to decide? didja do it? yes no?

My fixer-upper thus far (1915 Craftsman Style home, purchased for $225,000 which is a very good price where I live):

21 new windows to be replaced (in awful condition, has to be done): $15,000
Gut rehab of 1970's kitchen (again, in awful, unusable condition, and have discovered mold behind tile work as well): Budget is $30,000 approx.
Electrical to bring house up to Code (has not been touched in over 25 years, some knob & tube wiring still in existence, needs upgraded box for today's modern appliances, computers, need more outlets, GFI's, etc.) - $10,000
Misc. Plumbing (laundry gas line, repair waste stack, new laundry sink, new hook-up of water line for refrigerator, repair of some other broken items) - $4000
New garage door (completely rotted away) - $2000 approx.
New exterior doors (many rotted or in poor condition) - $3000 approx.
Refinish wood floors - $2000 approx.
Install central air conditioning - $8000
Repair gutters/leaders - $2000 approx (not sure yet)
Misc. other repairs mandated by City (yes, many cities will force you to do certain repairs) - walkway and front stair re-setting/repointing, handrails, new concrete walkway from driveway, remove old insulation from attic, remove ivy from garage and paint garage, paint certain areas of house that are in poor condition, etc. - $???? - don't know cost yet of these items.

I'm guessing my budget to be approximately $80,000ISH, probably will be more. This is with good contractors, well known in the area with expertise in their fields. I also need furniture, window treatments, some rugs, and last but not least, landscaping. There is a part of the back area which is a pit of ivy choking out everything in it's path which needs to be dealt with. Probably when all is said and done I'm sure I'll have spent close to $100,000 with all items included.

Oh and all those small items we're doing on our own which we can do - interior painting, sanding the woodwork and restaining same, some planting of bushes/flowers.

There is no way to get by "cheap" for an old home. You go into it loving the house, and hoping for the best, and knowing you need to spend what you need to.

This is an interesting series of posts. If Dr. Phil were to read it, I bet he'd say that it is apparent that Frontier has already made up her mind. In general, I think it is true that when people ask for advice, they have actually already made up their mind and are just wanting validation for their decision.