Fixer-uppers are where the value is, and also where the mistakes are expensive. The buyers who do well with them are not the ones who guess at repair costs. They are the ones who know the numbers before they offer. We buy, repair and resell houses for a living, so we can walk a property with you and put real figures on the work.

Cosmetic work versus structural work

Not every fixer-upper is the same kind of project, and the difference decides your budget and your timeline:

• Cosmetic: paint, flooring, fixtures, kitchens and baths. Usually the best place for a first-time renovator to start.
• Systems: roof, HVAC, plumbing and electrical. Costly, but predictable once a licensed contractor has inspected them.
• Structural and moisture: foundation movement, rot, failed crawlspaces and water intrusion. These can be fine to fix or a reason to walk away, which is why we want a professional opinion before you commit.

How we put numbers on a fixer-upper

We start with the after-repair value, which is what comparable updated homes nearby have actually sold for. Then we estimate repairs line by line, add a cushion for the things nobody can see yet, and work backward to what the house is worth to you today. Many experienced investors keep a contingency of ten to twenty percent of the repair budget, because surprises are normal in older houses.

A common rule of thumb among investors is to avoid paying more than about 70 percent of the after-repair value minus repairs. It is only a starting point, not a promise, and the right number depends on your costs, your timeline and the neighborhood. We will help you run your own math.

Ways to pay for one

• Cash, which is simple and fast and often wins against financed offers
• Renovation loans, such as the FHA 203(k) and conventional renovation products, which can fold repairs into one mortgage
• Private or hard money, usually short-term and mostly used by investors, with higher costs
• Creative options, such as seller financing, when a seller is open to it

Talk to Nil about approved lenders. Loan programs have their own rules, and we will never promise that you will qualify.

Permits, contractors and timing

Check that the work needs permits, and use licensed and insured contractors. In Georgia the permit rules vary by city and county, so ask the local building department before you start. Plan for the project to take longer than the first estimate, and decide in advance how you will cover carrying costs if it does.

Where we help

We work with fixer-upper buyers across Atlanta, Brookhaven, Decatur, Duluth, Ellenwood, Griffin, Hampton, Lawrenceville, Lilburn, Locust Grove, McDonough, Norcross, Snellville, Stockbridge, Stone Mountain and Tucker.

Nil Patel is a licensed Georgia real estate salesperson with Keller Williams Realty Atlanta Partners. This page is general information, not legal, tax or financial advice, and nothing here is a commitment to lend. Talk to a lender and a real estate attorney about your own situation.