Should I buy a newly-renovated, move-in ready, fixer-upper or tear-down property?

Properties come sold in varying degrees of conditions.  Some properties have just been renovated down to the studs, and so come with “new everything” and the latest in design aesthetics.  Other properties may not have been renovated in decades, and need substantial investment to make the property feel like home (or even be livable).

Whether to focus on particular property conditions will depend on personal preferences, your availability to devote time to a renovation, and your financial flexibility.  

Buying a fixer-upper or tear-down property is cheaper, and allows buyers to customize their home to suit their preferences and tastes.  However, time must be budgeted for designing, permitting and completing the renovations, during which time you may not wish (or not be able) to live in the home.  Completing such a renovation will also require your time to select contractors, designs and materials, and to oversee the project’s timeline and budget. And while you can normally finance 70%+ of the purchase price of your home, you can expect to pay all of the cost of renovations in cash (although you can likely refinance those costs once the renovations are complete).

Buying a newly-renovated property means you can move straight in and begin enjoying your (almost) brand new property.  Someone else has already taken care of overseeing the big renovation project, and you haven’t had to deal with selecting doorknobs for the cabinets in the third bathroom.  You’ll likely pay more for a newly-renovated property, and you’ll have to be content with the design and aesthetic choices made by someone else, which may not be precisely to your taste.

The middle ground is to buy a move-in-ready property.  These properties will be cheaper than a newly-renovated home, but won’t require any immediate improvement work before you can move in.  A move-in-ready property will allow you to live in the property for some months, or even years, to get a feel for the place, at which point you can decide which renovations to proceed forward with.

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Buyers' Guide