When given the choice of staying home and fixing up around the house some fellas will be opt for a morning at Home Depot and a weekend on a ladder. I want to buy the house these people are selling. Are they the norm? Doubt it.
A good use of a home equity line of credit, when homes had equity and our ratings had credit, would be home improvements. But the allure of an exotic week to 10 day vaction to an island beach house with tile floors, luxury kitchens, and fancy bathrooms was more appealing than replacing the old vinyl with tile and the kitchen with brilliance. Procrastination Vacation. So today we have upside down mortgages or tapped out equity, limited income, and maxed out credit cards. When the writing is on the wall and selling the house is the way out of a financial press, where will the money come from to bring the 20 year old house up to speed? I give up.The money probably isn't there.
Good homes in great locations are on the market. The asking price might include the cost of that spectacular vacation, the cottage up north, or the third car, and cool boat. (I always intended to pay those off with the next big pay day or bonus.) Should the owner expect a buyer to pay the price for my grand lifestyle? No, but that doesn't mean somebody won't try.
When you see a property with a few years worth of weekend projects left behind, it's a good indicator that the money for improvements is gone on the seller's side of the closing statement. Prior to today it was typical for a home buyer to estimate the expense of updating higher than actual and negotiate for a credit or price discount at twice the actual cost. That approach won't work today. The money is gone. A more successful strategy is to take the time to get real estimates and use real prices.
Reputable remodelers are charging fair prices. If you can come to terms on price, exclusive of the repairs, and the location is terrific, keep moving to closing by focusing on real costs. Losing a house that has the right location because we can't negotiate extraordinary expenses for repairs might be short sighted. A perfect condition property in an equally ideal location will have more demand and drive a higher price. It is more likely that location won't be comparable and you will pay more than you should for a house that has less of what you want. The National Association of Remodelers- Madison Chapter is a super resource for the people you need to make smart decsions and get brilliant remodeling.
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