As home prices in the Greater Toronto Area become higher, people who are looking to buy a home but find the majority of Toronto-area real estate outside of their price range may want to buy a fixer-upper, or a home that needs some work. According to the Ontario Real Estate Association, the costs involved with a fixer-upper home that needs extensive renovation work may still provide you with big savings compared to buying a more expensive home that doesn’t need work.
“Everyone wants a house or condo that will be perfect the minute they move in so they only have to do the minimum amount of work to it,” said the president of the Ontario Real Estate Association in a press release. “But with the price of houses continuing to rise, and some buyers desperately looking for a family home in a seller’s market, it may not be an option for all buyers. Buying a property that needs work can be a way to save on the overall cost even when you factor in the cost of an extensive renovation.”
However, home buyers should weight the pros and cons of fixing up a home, and make sure they know they’ll be able to sell it for a decent price later to recoup their investment.
“It doesn’t make sense to invest $100,000 worth of renovations in a property if the other homes only sell for $50,000 more than what you bought the house for,” she said. “Buying a house that needs renovation should grow equity – not become a property that’s to expensive for the neighbourhood when you want to sell.”
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