Las Vegas Real Estate News & Market Trends

You’ll find our blog to be a wealth of information, covering everything from local market statistics and home values to community happenings. That’s because we care about the community and want to help you find your place in it. Please reach out if you have any questions at all. We’d love to talk with you!

 

June 27, 2018

Are You Paying Too much Rent For The Number Of Bedrooms?

The County has determined caps for rentals. Below is the official pricing cap chart

 

U.S. DEPARTMENT OF HUD STATE: NEVADA ---------------- 2018 HOME PROGRAM RENTS ----------------------

PROGRAM EFFICIENCY 1 BR 2 BR 3 BR 4 BR 5 BR 6 BR

 

Carson City, NV MSA

LOW HOME RENT LIMIT 564 657 788 911 1017 1122 1226

HIGH HOME RENT LIMIT 564 682 862 1173 1289 1403 1518

For Information Only: FAIR MARKET RENT 564 682 862 1254 1518 1746 1973 50%

RENT LIMIT 613 657 788 911 1017 1122 1226 65%

RENT LIMIT 793 851 1023 1173 1289 1403 1518

 

Las Vegas-Henderson-Paradise, NV MSA

LOW HOME RENT LIMIT 613 657 788 911 1017 1122 1226

HIGH HOME RENT LIMIT 642 784 973 1150 1264 1376 1488

For Information Only: FAIR MARKET RENT 642 784 973 1415 1705 1961 2217 50%

RENT LIMIT 613 657 788 911 1017 1122 1226 65%

RENT LIMIT 778 834 1003 1150 1264 1376 1488

 

Reno, NV MSA

LOW HOME RENT LIMIT 623 689 827 955 1066 1176 1286

HIGH HOME RENT LIMIT 623 757 977 1209 1329 1448 1567

For Information Only: FAIR MARKET RENT 623 757 977 1421 1721 1979 2237 50%

RENT LIMIT 643 689 827 955 1066 1176 1286 65%

RENT LIMIT 818 877 1054 1209 1329 1448 1567

 

Churchill County, NV

LOW HOME RENT LIMIT 613 657 788 911 1017 1122 1226

HIGH HOME RENT LIMIT 703 708 941 1178 1295 1410 1525

For Information Only: FAIR MARKET RENT 703 708 941 1262 1342 1543 1745 50%

RENT LIMIT 613 657 788 911 1017 1122 1226 65%

RENT LIMIT 796 854 1027 1178 1295 1410 1525

 

Douglas County, NV

LOW HOME RENT LIMIT 647 733 880 1016 1135 1251 1368

HIGH HOME RENT LIMIT 647 777 1014 1297 1428 1557 1686

For Information Only: FAIR MARKET RENT 647 777 1014 1463 1786 2054 2322 50%

RENT LIMIT 685 733 880 1016 1135 1251 1368 65%

RENT LIMIT 876 941 1131 1297 1428 1557 1686

 

Elko County, NV

LOW HOME RENT LIMIT 604 712 937 1083 1208 1333 1457

HIGH HOME RENT LIMIT 604 712 947 1378 1458 1677 1821

For Information Only: FAIR MARKET RENT 604 712 947 1378 1458 1677 1895 50%

RENT LIMIT 730 781 937 1083 1208 1333 1457 65%

RENT LIMIT 944 1013 1217 1398 1540 1681 1821

 

Esmeralda County, NV

LOW HOME RENT LIMIT 445 575 697 911 1017 1122 1226

HIGH HOME RENT LIMIT 445 575 697 985 1121 1289 1457

For Information Only: FAIR MARKET RENT 445 575 697 985 1121 1289 1457 50%

RENT LIMIT 613 657 788 911 1017 1122 1226 65%

RENT LIMIT 778 834 1003 1150 1264 1376 1488

 

Eureka County, NV

LOW HOME RENT LIMIT 564 665 884 1140 1272 1403 1534

HIGH HOME RENT LIMIT 564 665 884 1249 1422 1635 1849

For Information Only: FAIR MARKET RENT 564 665 884 1249 1422 1635 1849 50%

RENT LIMIT 767 822 987 1140 1272 1403 1534 65%

RENT LIMIT 978 1049 1261 1449 1596 1742 1889

 

Humboldt County, NV

LOW HOME RENT LIMIT 602 714 866 1000 1116 1231 1345

HIGH HOME RENT LIMIT 602 714 944 1184 1286 1479 1672

For Information Only: FAIR MARKET RENT 602 714 944 1184 1286 1479 1672 50%

RENT LIMIT 673 721 866 1000 1116 1231 1345 65%

RENT LIMIT 905 971 1167 1339 1474 1608 1742

 

Lander County, NV

LOW HOME RENT LIMIT 663 775 931 1075 1200 1323 1447

HIGH HOME RENT LIMIT 663 781 1039 1303 1573 1717 1861

For Information Only: FAIR MARKET RENT 663 781 1039 1303 1672 1923 2174 50%

RENT LIMIT 723 775 931 1075 1200 1323 1447 65%

RENT LIMIT 964 1034 1243 1427 1573 1717 1861

 

Lincoln County, NV

LOW HOME RENT LIMIT 448 612 703 911 1017 1122 1226

HIGH HOME RENT LIMIT 448 612 703 1023 1131 1301 1470

For Information Only: FAIR MARKET RENT 448 612 703 1023 1131 1301 1470 50%

RENT LIMIT 613 657 788 911 1017 1122 1226 65%

RENT LIMIT 778 834 1003 1150 1264 1376 1488

 

Lyon County, NV

LOW HOME RENT LIMIT 554 653 788 911 1017 1122 1226

HIGH HOME RENT LIMIT 554 653 868 1150 1264 1376 1488

For Information Only: FAIR MARKET RENT 554 653 868 1260 1527 1756 1985 50%

RENT LIMIT 613 657 788 911 1017 1122 1226 65%

RENT LIMIT 778 834 1003 1150 1264 1376 1488

 

Mineral County, NV

LOW HOME RENT LIMIT 446 526 699 876 1017 1122 1226

HIGH HOME RENT LIMIT 446 526 699 876 1125 1294 1463

For Information Only: FAIR MARKET RENT 446 526 699 876 1125 1294 1463 50%

RENT LIMIT 613 657 788 911 1017 1122 1226 65%

RENT LIMIT 778 834 1003 1150 1264 1376 1488

 

Nye County, NV

LOW HOME RENT LIMIT 515 657 788 911 1017 1122 1226

HIGH HOME RENT LIMIT 515 659 807 1150 1264 1376 1488

For Information Only: FAIR MARKET RENT 515 659 807 1168 1366 1571 1776 50%

RENT LIMIT 613 657 788 911 1017 1122 1226 65%

RENT LIMIT 778 834 1003 1150 1264 1376 1488

 

Pershing County, NV

LOW HOME RENT LIMIT 445 524 697 911 1017 1122 1226

HIGH HOME RENT LIMIT 445 524 697 997 1121 1289 1457

For Information Only: FAIR MARKET RENT 445 524 697 997 1121 1289 1457 50%

RENT LIMIT 613 657 788 911 1017 1122 1226 65%

RENT LIMIT 779 836 1004 1152 1265 1377 1490

 

White Pine County, NV

 

LOW HOME RENT LIMIT 565 675 810 935 1043 1151 1258

HIGH HOME RENT LIMIT 565 763 885 1182 1299 1415 1530

For Information Only: FAIR MARKET RENT 565 763 885 1287 1330 1530 1729 50%

RENT LIMIT 630 675 810 935 1043 1151 1258 65%

RENT LIMIT 799 857 1031 1182 1299 1415 1530

 

For all HOME projects, the maximum allowable rent is the HUD calculated High HOME Rent Limit and/or Low HOME Rent Limit.

 

 

Posted in Market Updates
June 26, 2018

was your offer to buying a house accepted?

That seemingly never-ending waiting period when you’re on the edge of your seat to find out whether your offer to buy a house has been accepted can be more than a bit stressful. In an ideal world the seller would notify within 24 hours whether or not the offer has been accepted, rejected, or countered. In reality, getting word from the seller can take longer.

But what if the online listing has disappeared completely? When this happens you can only assume that you did not get the deal. The National Association of Realtors states that an agent should submit offers and counteroffers objectively and as quickly as possible. The only problem is that the guideline for that is very vague and can mean different things to different people.

In a regular sale, 2 to 3 days is a reasonable amount of time for buyers to wait to hear if their offer was accepted. However, “if there are multiple offers they may not be required to inform you, but out of courtesy, they should at least tell you if they took another offer.” Says David Welch, a Realtor in Winter Park, FL.

Once a week passes after you have submitted your offer to the seller, chances are your offer has not been accepted. Always have your agent do a follow up with the listing agent to get a response. Not getting the chance to counter is always going to be frustrating, or even finding out that your offer was rejected. You should have your agent reach out to the listing agent to find out what happened, even if the end result is not what you had hoped for.

Some sellers inform their agents to not show them any offers below a certain amount, so lowball offers are likely to be thrown out. Another scenario could be that there are multiple offers on the table and they are keeping your offer as a backup in case anything goes wrong with the others. The issue could also be entirely unrelated to real-estate. The sellers could’ve gone out of town or experienced and illness, death, or emergency.

When all is said and all is done goodbyes can simply be hard, but there comes a time when you need to face the facts and walk away from a property. In the end it’s up to you and your realtor to determine how long to wait for a response but keep in mind that if the seller’s agent is radio silent after a couple of weeks, the odds of the things working out for you are small.

 

After all, having an offer accepted is just the first step of many in the long process of buying a home. You need someone who is responsible and smart to go through all the stages with you.

June 26, 2018

5 Surprising Benefits of Country Living

Country living, fresh air, wide-open spaces, a slower pace of life. What’s not to love? Yet in spite of all those large acres just waiting for homeowners to stake a claim, country folk are a diminishing breed.

U.N. statistics predict that the percentage of Americans living in rural areas will plummet from its current 46% to 34% by 2050.  Americans have forgotten the many benefits they can reap from country living that they certainly need to remember.



Benefit No. 1:

More ‘vitamin G’

The phrase “vitamin G” stands for greenery. Not only do trees and plants provide beauty, they also come with some serious benefits that science is just beginning to understand. The lack of greenery from the body can affect humans tremendously.

A University of Michigan study found that when humans spend even a few minutes on a crowded city street, their brain is less able to retain information or control urges. A similar study found that residents living in apartment buildings with views of concrete or asphalt were reported higher levels of anger or stress than did their counterparts living in identical buildings with tree views.

Another benefit is air quality. People living near more trees and grass generally experience lower levels of air pollution.

 

Benefit No. 2:

Fewer psychological problems

Ever heard of the saying “The city is making me crazy!”? well it actually might be. According to the journal Schizophrenia Bulletin, at least 10 studies have shown that people in urban areas are more likely to develop psychiatric disorders such schizophrenia. More than one-third of all schizophrenias cases are related to environmental factors in an urban setting.

More studies have shown that residents in rural areas have less cases of anxiety disorders.

 

Benefit No. 3:

You’re less likely to get mugged

According to the bureau of Justice Statistics’ annual National Crime Victimization survey, violent crime rates in rural areas are almost one-third lower than those in urban centers. The rate of violent victimizations reported in metropolitan areas was 3.2%, as opposed to 2.1% rural areas in 2012. In rural areas rape, murder, and property crimes are lower. Country living people should still install security systems, since stats do indicate that home burglary rates are higher in rural areas.





Benefit No. 4:

You’re more likely to own your home

Most people in the world fantasize of owning, rather than renting, their own home someday, and it seems that the possibility of that fantasy gets exponentially higher the farther one ventures into the country. Recent studies have shown that homeownership is higher in states with more rural communities such as West Virginia (76%), Michigan (74%), and Vermont (73%) than in states with big urban centers such as Washington, DC (41%), New York (52%), and California (54%).

 

Benefit No. 5:

Lower cost of living

A large amount of people cites a lower cost of living as a reason for making a rural move, and there is an undisputed truth to this argument. Research in the International Regional Science Review found that in Pennsylvania the average urban resident pays 6% more for all six major categories of goods, with the greatest difference occurring for housing costs.

 

Country living is more than a few minutes outside of the city, it’s also a lifestyle, a way of life. So the next time you are thinking of moving or changing the way you live, maybe give the country life a chance.

 

May 25, 2018

How Interest Rates Affect Mortgage Payments

First time home buyers and experienced buyers alike always have questions about the process. One of the most commonly asked question is how interest rates will affect you mortgage payments. A house is a big investment, so it is important to understand the finances involved.

 

Each loan option is slightly different, though most will have two parts, Principle and Interest (P&I). You may also run into PITI loans that include Tax (T) and Insurance (I) as well as the Principle and Interest. You Principle is the loan amount you agreed to when you bought the home, just like with any loan.

 

Loans don’t just differ in terms of what is included in the payment. There are also different types of loans that use the interest rate differently. The majority of loans that you will come across will be fully amortizing, fixed rate loans. Amortization is the process in which the amount paid to interest reduces with each payment.

 

When applying for a new loan you should try to get the lowest interest possible. Not only will this reduce your payment, but it will also drastically reduce the total amount you paid for the home. For example, if Jake and Mary each received a $200,000 30 year loan, but Jake had a 3% interest rate and Mary had a 5% interest rate, Mary would end up paying more for her home. Jake’s mortgage payments would be $843 a month and would end up paying $303,544 total for the whole loan while Mary would have a $1,073 monthly payment and spend a total of $386,513 for the loan. A 2% difference doesn’t sound like a lot at first, but it adds up.

 

Be sure to talk to a lender before shopping for your next home so you find the right loan and interest rate to fit your needs.

April 9, 2018

Should I Wait to Sell Until The Raiders Come To Vegas?

The Las Vegas Real Estate question of 2018 !
Should you sell now or wait until the stadium is built to get more money ?

It’s a great question that 8 out of 10 sellers are asking , so let’s dig deeper into this .

When you sell , will you still be living here in Vegas ? If prices do increase , so will the prices of the home you are purchasing .

What about interest rates ?

Let’s do the math here  ...say you have a home today worth $400,000 and you have the ability to walk away with $200,000 , and you are going to put this as a down payment on a home worth $500,000 , this would put you at an approximate monthly payment of $2100 . IF your home value does increase , for instance another $100,000 over the next couple years , and the home you are going to purchase also increases by $100,000 .. AND interest rates go up 1 or even 2 points as well ( there has been talk of 2 interest rate hikes just  in 2018 , so it’s very likely rates could increase even more ) this would bring your monthly payment to approximately $2400-$2700 per month ! When I purchased my first home 7.5 was a great rate ... this CAN happen , and likely will .
Is it worth the wait to pay more later ?

Right now in Vegas inventory is at all time lows , there are far more buyers than sellers in the market . This means multiple offers and many times ,  buyers paying above market value to be able to get the homes they want . If 8 of 10 sellers are waiting for the Raiders to come before listing , what will this do to inventory? There will be more inventory of higher priced homes

...and then there’s the economics ....

Who are the buyers now ? Aside from the locals , many of the buyers now are relocating from other states .. either because it’s still affordable to live in Vegas , or for jobs . There’s a huge amount of high paying construction jobs here in Vegas now , between the stadium and all of the new projects on the strip . Once everything is built and running , and everyone has already moved here , the average pay of the people actually working at the stadium is likely to be much lower . Who’s going to buy all of those high prices homes ?

Of course , I don’t own a crystal ball , however ..I do think the smartest plan of action is to sell now on the HYPE of the stadium, and you may get a better return !

Just some advice from your Vegas Native Realtor .

If your considering selling , talk to me about how we can get you the best return !

Trish Williams Team
Keller Willliams Realty
The Marketplace One
702-308-2878

April 3, 2018

How to Organise and Declutter Your Attic

 The attic quickly becomes the place to just cram all of the stuff you don't really need or use often, out of sight out of mind. The attic can be a great place to store a lot of items that you don’t need on a daily or even weekly basis, but for this space to be effective you’ll need it to be organized.

 

Timing Is Everything

Make sure to put some thought into when you organize your attic. Especially in Southern Nevada where it gets hot, you want to be strategic about when you go up there. The cooler months are an ideal time to organize as the temperatures in the attic will be mild. In the summer when you run your A/C the cold air will settle on the ground level of the home and the hot air will raise up to the ceiling, compound that with the heat from outside baking the roof and warming the attic space, the attic will become an oven very quickly. Also try to schedule your cleaning with the trash days, this way whatever you end up throwing out will be removed within a day or two. Some city areas have mass trash pick up days. If you think you will need to throw away large items or more items than what can fit into your trash cans, make sure to do your clean out just before this day.

 

Be Prepared

Get ready before you even start. Gather the materials you need such as boxes, trash bags, markers, etc. This will make it very easy on you since you won't have to keep climbing up and down to get the things you need. Because of the extreme temperature changes in an attic, you should choose a bin that will hold up to those changes. Heavy duty plastic bins are the best option for storage. This can also protect your belongings if there was a leak in the roof.

 

Sort Everything

Start your organization by clearing a path and a decent section of the floor space if you can. This will give you room to make several piles. The minimum number of piles you should have is two for ‘Save’ and ‘Throw Away’. You can also add a donation pile or even piles for different people if you are splitting a household. If the piles start to get too sizeable and you begin to run out of space, bring the items in the toss pile, or donate pile if you made one, and bring them to a designated area.

Once you have removed all of the unwanted items, it’s time to pack it all up. We aren’t done sorting yet. Group like items with each other in bin and store boxes full of similar items together. When putting the boxes away take note of boxes that you may need later such as holiday decorations. Place these boxes in an easy to access location.

 

April 3, 2018

How to Evict a Relative Who Has Overstayed Their Welcome

It is not uncommon for homeowners to run into issues with tenants who overstay their welcome, but when it is a family member the subject gets even more touchy. They promise they won’t be a burden on you or your home, and in the beginning that may be true, but after a while they start to get too comfortable or have just been in your home too long. If you ask them to leave and they refuse to budge it may be time to take legal action in the form of an eviction. Here are a couple things to think about before you start.

 

Eviction is not a one size fits all process. Different cities and states have different guidelines and procedures that need to be followed to go about eviction legally. For example, in Nevada it is illegal to do what is called constructive eviction. This is that act of changing something in the home to make the home either inaccessible or uninhabitable for the tenant. This can include turning off the utilities, changing the locks, removing necessary fixtures such as a toilet, etc.

When starting the eviction process be sure to consult a lawyer that specialises in tenant and landlord laws. They will have all the knowledge you need to keep you out of trouble and make the process as smooth as possible with their guidance. Nevada is a tricky state when it comes to eviction, many of the laws protect the tenant outright, so you really want to make sure you are not conflicting with the law.  Generally, this is what you will need to do to evict someone, but always be sure to check with your lawyer before taking action.

  1. Serve the tenant a notice to vacate, this is a warning. This notice should state when they must vacate by and why you are evicting them. Most places require 30 days notice. Be as clear as possible in this notice. If you are willing to allow them to stay if they perform a certain action, make that very clear as to what they must do and by when. The notice has to be written carefully. The assistance of an attorney is very helpful in this portion.

  2. If the tenant does not leave or perform the actions you requested, you will need to file an eviction petition with the court. You may ask for an unlawful detainer hearing. This is when a judge will listen to your reasons for eviction and look over your notice to vacate. If the judge rules in your favour they will issue an order of eviction and writ of possession. This gives you your property back.

  3. If the tenant still refuses to leave, they are now in violation of the court. You can now involve the authorities, but bare in mind this will strain family relations so be tactful when doing this final step.

Some basic principles to follow when renting out your home to a relative or otherwise include;

Don’t accept rent if you are trying to evict someone. During the eviction process there is a time limit that the tenant has to leave, but by accepting rent you will be restarting that time frame.

Put it in writing if someone is going to be living with you or in a home you own for any extended period of time. You will want to outline what you expect from the tenant. If you allow your nephew who just recently graduated from college to live with you as long as they are looking for work and picking up after themself, put it in writing. This will protect you if the tenant breaks the rules and you want them to find a new place.

Try to work it out when you can. Sometimes paying someone to leave will cost you less than the legal fees involved in forcing them to leave. This can also save the relationship with your relative.

March 28, 2018

How to Declutter Your Home While Still Keeping All of Your Stuff

Clutter has become a bit of a taboo word. In recent years many people have searched for ways to bring themself to part with objects that they may no longer have use for anymore, from thanking the items before tossing them, to donating item or even just outright selling them.  But what about those of us who still enjoy the items that make up our ‘clutter’? There is a way to fake it; to make it seem like the clutter is no longer there while still maintaining all of these items.

 

Group Like Items Together

Items can appear like they are clutter when they are in fact just in the wrong place. By categorizing  your items you reduce the appearance of clutter. For example, group items like all shirts go into one drawer, or all extra toiletries go into a designated drawer/cabinet, etc. This creates an organized look to the space. It also will make finding any given item a lot easier too! Another optical trick is to group items by size or color. You could easily group books or even nicknacks this way to give shelving a cohesive feel.

 

Store Items Where They Are Used

‘Everything has a place and is in its place.’ But does this place make sense? It seems like a no brainer to put items where they are used, but it is quite common for items to be stored a good distance from where their designated task happens. Storing items like umbrellas by the entrance, coffee mugs near the coffee pot, pet foods near their bowls, etc. It is when these types of items are not in the most effective location that we get cluttered areas.

 

Look Up

It’s easy to run out of space when you only use the floor or maybe a table to organize your possessions. You can free up some of that floor space by adding hooks or shelves to store your items. However, be strategic with your use of wall space. It is easy to cram a huge stack of bins into a closet, but what happens when you have to get something out of the bottom bin? Whatever is in there may as well not exist at that point. When utilizing vertical space take note of how easy or difficult it will be to get your stuff back out. If you think it will be too challenging reevaluate your plan.

 

Furniture Can Provide Hidden Storage

Take a look at your furniture and see if any of them could be holding any hidden storage. Beds are a major gold mine for storage as many frames have enough space underneath to hide away short storage containers or items, or maybe behind the couch. You can also find furniture with storage built in such as ottomans, coffee tables, and even couches. When buying a new home also look for homes with built ins or out of sight storage.

 

Corral The Cords

Tangled cords can quickly make a room look more cluttered than it actually is. By organizing the cords you eliminate this issue. You can find many organizers from boxes that double as a charging station, to a cord cover to conceal them to help with this task as well.

 

Worst Comes To Worse, Rent A Storage Facility

 

If you really are out of space there are always storage facilities. Running out of space can make you think you have to throw things out that may make you feel regret later.  

 

March 28, 2018

Downtown Las Vegas Increasing In Value

According to new reports, Downtown Las Vegas is the new place to be. New data shows that the two areas with the highest growing home value rates are Huntridge and “Downtown East”. According to Zillow, these neighborhoods have seen an over 31% rise in home value.

Downtown East, which consists of homes within, Bruce Street west, Charleston Boulevard south, and the 95 curving North and East, had a median home price of $111,000 in February. The slightly larger neighborhood of Huntridge, which includes homes in the Historic John S Park, South Ridge, Showboat, Crestwood, and Francisco Park neighborhoods, had a median home value of about $162,000. It is only natural to see growth in these nearby neighborhoods after the recent efforts to expand downtown’s culinary, cultural, and business footprint in that past few years.

A long time homeowner expressed that they had seen more and more young people and first time home buyers moving into Huntridge, including Mitchell Wilburn and his wife Andrea who bought a three bedroom home in February for about $210,000. When asked why he had chosen this neighborhood by Fox 5 he explained, “We are of the hip downtown, shiftless-artist types and we love very period, kitschy mid-century design.” He also noted that the pink piano bathtub sealed that deal, and that this home may have been their last chance to own property that could increase in value. “In our age bracket, hardly anyone is anywhere near able to compete with the viciousness of house-flipping and renting hustlers.” She said.

Additionally, homes in the Charleston Heights neighborhood, Winchester, and Rancho Charleston also are increasing in value.

 

The data chart listed below is courtesy of Zillow.

 

Fastest Growing Home Values

Posted in Market Updates
March 22, 2018

Thinking Of Buying A Fixer-Upper…Better Read This First!

 Buying a fixer-upper is one of those endeavors that looks so fun on TV (thanks, Chip and Joanna Gaines), but make no mistake; in real life, it’s a huge risk, and a whole lot of work. So before you set out to swoon over some hovel you dream of transforming into your dream home, you should learn a few things about how to find a diamond in the rough rather than a money pit-and how to do the math to make sure it’s worth all the sweat equity you’re about to pour into it. So here’s what you really need to know about buying a fixer-upper

Find The Worst House On The Best Block

Rule No.1? You can’t go wrong with the age-old adage of buying “the worst house on the best block,” says Dan Bawden, Remodelers Chair of the National Association of Homebuilders and veteran fixer-upper contractor. The reason: the high price of comps-I.e homes of similar size nearby-will have a positive effect on the price of the homely bargain you’re buying. Once it’s fixed up, of course.

Bawden’s rule of thumb is that you should aim to spend 20% to 25% less than what a property in good condition would cost in the area. Do your research and make sure you’re comparing apples to apples. Look at price per square foot and numbers of bathrooms and bedrooms. And understand that price isn’t the only factor to consider (more on that next).

Find A Fixer-Upper That Needs Cosmetic Changes

Bawden cautions against buying anything with major flaws that will eat up your renovation budget. The best fixer-uppers are ones that mostly need cosmetic updates-things like kitchen and bathroom renovations, new floors, siding repair, or wallpaper removal. When it comes to big things like foundation problems, termite damage, or evidence of water damage (especially in coastal areas), these should be deal-killers. If you’re considering a house that needs serious upgrades  to the electrical systems, roof, or HVAC, make sure you’re getting enough of a discount to cover the expenses of these repairs, which can be sizable.

Get A Contractor To Estimate How Much It’ll Cost

If you are planning to hire a contractor to do the work, have him give you a bid for the job before you make an offer on the house. You may have to pay the professional in a few hundred dollars to walk through a potential home and estimate the renovation costs, but it’s worth it.

“Think of it like another home inspector,” suggests Bawden. Once you have your figure for the remodel work, add at least 5% for unforeseen issues since there will always be some surprises. Even the best contractor can’t see through walls, and you don’t want to blow your budget if you pull up the linoleum in the kitchen and find rotten boards below.  

Do The Math Before You Make An Offer

The time to figure out if a fixer-upper is really a good deal is before you buy it.It’s easy to get swept up in planning a major renovation, but for your long-term financial well-being, you have to make sure the numbers work first.

To get the green light, you should know confidently that after your renovations are complete, you can sell the place for at least as much money as you’ve put in (ideally more). Got that? Even if you plan to live there forever, this is key. Because life is unpredictable, You never know when you’re going to have to move unexpectedly, so you should never invest in a home where you can’t recoup the costs if need be.

So first, determine what the house would sell for with the upgrades you’re planning. Let’s say hypothetically $300,000. Let’s also say that your contractor tells you it’s going to cost $80,000 to do your repairs (including your 5% wiggle room). To make the numbers work, you should not pay more than $220,000 for the house. If for instance, the home’s seller won’t accept less that $240,000, that may mean you should rethink your renovations and spend only $60,000.

Finally, determine whether you can live in the house while doing the renovations. If not, you’ll have to factor in rent during the time it takes to renovate (and you’ll want to give yourself a few months’ padding there too).

Stick To Your Budget

While totaling your reno budget, make sure you’ve picked out the inishes you want, too, because it’s very easy to splurge when shopping for things like faucets, backsplash tile, or appliances. “You can go to the store expecting to spend $60 on the faucet and fall in love with a lever-handled faucet that looks like angel wings…and costs $250,” says Bawden. “It’s human nature to say ‘Why are we spending all this money to cheap out on the little things?’ but it can add up fast and really inflate your budget.”

-Article courtesy of Horseman’s News January 2018