Starter House Or Fixer Upper: How To Pick What’s Best For You?
August 9, 2021
‘Should I buy a starter house or should I go for a fixer-upper?’
This is a dilemma many first-time home buyers face. If you are also stuck in the same situation at the start of your home buying journey, then this post is for you. Here, we will be sharing the pros and cons of buying a starter home vs a fixer-upper home to help you make the right choice.
Let’s take a look.
What Is a Starter Home?
A small home is generally bought as the first home and is a popular option amongst younger home buyers. That’s what a starter home is. What makes starter homes a popular choice amongst younger home buyers?
Pros of buying a starter home
Buying a starter home costs less money. They are more affordable than buying a fixer-upper. According to data published on CNBC, the median price for a starter home in the U.S. metro in the first quarter of 2020 was $233,400.
- Less property tax
Starter homes have lower property taxes, which is another reason why they are a popular choice amongst people who are looking for an affordable house.
- Ticket to desirable zip code
Instead of waiting for years to save money to buy a house in a desirable location, you can buy a starter house that costs way less and gives you access to the local perks of a good neighborhood.
- Lower maintenance costs
The smaller the house, the lower the maintenance costs. This is another reason why buying a starter home is preferred by first-time home buyers who are not ready to get overwhelmed by homeownership.
Cons of buying a starter home
- Less space
Starter homes tend to have smaller spaces. If you are a growing family, chances are that you will outgrow these houses, and need to move to a bigger space sooner than you anticipated.
- Low-end features
Since a starter home is designed keeping in mind the affordability, chances are that you will not get all the features that you expect your dream home to have.
- The feeling of not being settled
The biggest con of buying a starter home is that you might never feel settled, as you cannot picture yourself living in this home for years to come.
What Are Fixer-Upper Houses?
A fixer-upper is a house that’s available for sale at a lower price because it needs repair and maintenance work. Mentioned below are the pros and cons associated with buying a fixer-upper:
Pros of buying a fixer-upper house
- Lower buying cost
Fixer-upper houses are a great option for first-time home buyers who are looking to buy property on a budget. Sellers tend to settle for a lesser than the asking price since the house needs immediate repairs.
- Lower tax liabilities
Taxes are calculated on the selling price of a house. Since fixer-upper houses have lesser selling prices, you will be paying less in property taxes.
With fixer-upper houses, you have the opportunity to customize your house renovations. Whether it is a modular kitchen or a house deck or ultra-lavish bedrooms, you can prioritize your spending.
Cons of buying fixer-upper houses
- Not move-in ready
The biggest con of buying a fixer-upper is that you will have to wait before your house is move-in ready. Repairs tend to take time, and you can never be certain about how much time repairs will take before you move in.
- Unplanned expenses
Fixer-uppers tend to come with a lot of unplanned expenses. You can never anticipate the complications that might arise. This is the reason that fixer-upper houses generally end up costing more than what you had planned.
- A riskier investment
Considering the unplanned structural complications that might arise in fixer-uppers, they are often a riskier investment than a starter house.
What’s The Right Choice For You?
As you can see, both types of houses have their pros and cons. The choice largely depends upon your circumstances. If a ready-to-move-in option is your priority, and you can compromise on space, then buying a starter house is the ideal investment.
However, if you can wait longer to move in, can afford to invest in repairs, and looking to buy a property where you can stay for years and years, then buying a fixer-upper should be the go-to option.
Get In Touch With Experts To Make The Right Decision!
If you are unsure of which option is better for you, then we advise getting in touch with a real estate expert like an NRP (Negotiator Recognized Professionals). These professionals can help you with your home search, negotiate on your behalf and get you the best deal for your dream home. Apart from this, they can always share some expert advice to make your house search easy as pie.
So, what are you waiting for? Get in touch with an NRP and start your search for a dream house today!