This is a question like many others here that has no simple answer. First you must do an honest evaluation about your abilities to actually do the fix-up work. Most houses that have deteriorated to the fixer-upper level require quite a bit more than just stripping some wallpaper and repainting. Buying a true fixer-upper is not for the faint of heart or unskilled.

Here is my advice – take it or not.

First, get the most thorough home inspection that you can on the place. Fixer-upper homes often have LOTS of hidden damage and issues. Many fixer-uppers have suffered through years as rental units, without anyone really caring about what was happening to major systems in the house. Some that are sold “as-is”, as fixer-uppers, were intentionally damaged by disgruntled owners (maybe as the result of a bad divorce) or renters. Some have just suffered the ravages of abandonment, especially is they have been left over a winter without being properly winterized.

The point is that these are many times houses that need and require much more than superficial redecorating and painting to be viable again either to live in or to re-sell. A good, thorough home inspection will likely result in a list (maybe a ling one) of things that need to be done to make the house livable again. DO NOT skip that step!

The next thing to consider is what the repairs and updates are likely to cost and whether or not you will be able to recoup those costs, should you  be considering selling the house once it is fit again. Here is an article on “Lessons Learned from a Remodeling Project” by a professional. Maybe it will help you better understand the potential issues that you could face.

Unless you are a licensed plumber or electrician, you will likely have to have problems in those areas handled by a licensed professional. You may be capable of doing many of the normal carpentry things yourself, but even those should only be done with a permit and with the proper post-work inspections and approvals by your community’s local governmental body.  Dong major work without permits will come back to haunt you or a future owner (who will then come looking for you anyway – and don’t for a minute think that you will be off the hook for that work).

Next, of course is to consider the cost and the return on the projects involved with the house. Here is a list of updates or home improvements, what they cost and  what they normally return to the home owner.

After you have had your own conscience-cleansing meeting with yourself and determined that you are, in fact, capable, willing and can afford to take on the work (whether that be work yourself or acting in the prime contractor role for work done by professionals) involved with a true fixer-upper, then you need to look at the financing implications.

You’ll need to determine whether or not an appraisal of this jewel will come close enough to the offer price to allow you to actually finance it. Most people who take on fixer-uppers do so because they can “see the potential” in the property. Most appraisers are just looking at what is there now. There can be a big disconnect. Unfortunately there is no way to determine this short of actually having the appraisal done. Assuming that the house will appraise at a enough to let you buy it, do you have the money (or personal borrowing power) to be able to afford to do the work that is required.

“Sweat equity” is what most first time fixer-upper see as their investment in the project, but the reality is that the new cabinets or the 2 X 4’s and the wallboard or the new bathroom fixtures or the new sink in the kitchen or the new carpeting all cost real money. If you go into a fixer-upper project under-financed for the renovation project, all you might end up with is a half-done money pit that you’re forced to try to unload (likely at a loss).

Assuming that you’ve done all of the inspections and the self-examination of your skills and financial ability (as well the time that you have to devote to renovation) and you’ve decided to go ahead with buying a fixer-upper.

One note of extreme caution! If you hit what you even think might be asbestos stop and get a professional involved. Asbestos is one of the nastiest things that you can deal with and you really shouldn’t try. To read about the dangers of asbestos, go to www.asbestos.com.