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What are Handyman Specials?
Handyman Specials are low cost, fixer upper homes that can be purchased for special discounts. Handyman specials are properties that are not in peak market condition. They are usually in need of repairs, but the degree of repairs each property requires can vary greatly. Some properties may only need basic repairs and clean-up to get market ready, while others could need more substantial repairs and remodeling. If you've ever considered fixing up a home yourself, handyman special properties can be a fantastic way to save money and earn equity through your own work!
Handyman Specials and Foreclosures
The foreclosure market provides one of the best sources for handyman specials you'll find anywhere. Sometimes, foreclosure properties can become neglected before they go up for auction, or in other cases, they may sit on the market as an REO or bank owned home for an extended period of time without any owner to worry about keeping up the home's condition. As a result, many of them end up needing repairs. But the great thing about foreclosed homes is that they are already sold for a big discount, often anywhere from 30% to 60% below what they'd be worth on the open market in move-in condition. This presents a valuable opportunity to buy a home for a great low price, put in a little extra work, and have a property in market condition worth a huge increase over what you paid for it. Throw in the added discount you'll find on handyman specials in need of a little TLC, and there's no other property out there with better potential for future value.
Handyman Specials and the Flipping Market
Handyman specials make great properties for investors interested in buying and flipping real estate for a profit. The trick is balancing the cost of repairs with the price you stand to pay for the home. By carefully estimating your repair costs, whether you hire a contractor to help or perform the work yourself, you can easily gauge just how valuable a property is. Handyman homes for sale can be purchased for around 60% off their value on the foreclosure market, and if you only spend another 30% on repairs, that's a 30% profit you stand to earn on a resale. Those kinds of values just aren't available on open market properties.
But is a Handyman Special for Me?
Even if you've never picked up a hammer in your life, a handyman special can still be a great investment. If you're serious about investing, talk to a local contractor and bring them with you on an inspection of a property you're considering buying. Contractors can help you see what's wrong with a property, and can give you estimates on the spot of what it will cost to repair. In many cases, there may be problems associated with a home you're not willing to take on. For example, many investors shy away from properties with structural or foundation problems. A cracked foundation can affect the entire building, and while this can be a difficult problem to spot, a contractor knows what to look for.
Handyman specials aren't just for those looking to do the work themselves. As long as you factor in the costs of hiring a contractor to help you and make sure you're profit margins are still where you want them, you can make some fantastic investments. The chances for discounts are just that big.
What to Know before Buying Handyman Specials
The most important thing to decide before you buy a handyman special is how much work you're willing to put into a property. If you're interested in doing minor repairs, maybe some window replacements and new flooring, and some light remodeling, you don't want to go buying a property with a roof that needs to be replaced. For this reason, getting a home inspection of any handyman property is crucial. A professional home inspector will assess everything, including plumbing and sewer connections, electricity, HVAC systems, structural issues, pest damage or infestation, and more to make sure you won't miss any problems with a home you're thinking of buying.
Buying the Right Handyman Specials
As with buying any other investment property or distressed property, location always comes into play. Ultimately, a home in a good location that's desirable among buyers is going to have a much better chance of appreciation in value than a property in an undesirable location. So never just go after the cheapest properties. You want to determine what's going to be valuable to buyers over the long term, and that means assessing local economies, school systems, and neighborhood profiles. Investing in handyman special homes for sale is all about maximizing value, and buying homes that have good chances for value appreciation are a key part of that.
How to Finance a Handyman Special
Another great perk of buying handyman special homes for sale is that many buyers qualify for special loans offered by the Department of Housing and Urban Development (HUD). Securing financing for a handyman special or fixer upper can sometimes be difficult, because banks want homes to be repaired and in good condition before they lend buyers money to buy them. Of course, buyers and investors can't just repair the property before they own it. The HUS 203(k) loan allows buyers to get the money they need to buy a fixer upper as well as the money the need to repair in one loan. This is much easier then taking out two loans, which banks may sometimes require.
Buying a Home for the Right Price
Remember, buying a handyman special is all about savings, but be sure to keep in mind that you'll spend some time repairing the home, and then more time marketing and selling it. You may not earn money back on your property, even if you plan to rent it, until you make all the necessary repairs. During that time, you'll still be responsible for property taxes and mortgage payments, so be sure to budget yourself enough time and money to make buying a handyman special comfortable.
Finding Handyman Specials
BankForeclosuresSale.com offers a wide range of great deals on fixer upper and handyman special real estate through our online database. We make it easy to search for the properties you want right in your area, without even having to leave your home. Check out our detailed listings and see what's out there to help you make your decision about what kind of handyman specials to buy! Let us help you find a great investment in a handyman property that meets all your needs today.