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What to look for - and avoid - when buying an older home

Ginger Dean

May 21, 2014

By: Ginger Dean, Home Finance Specialist

In: Finance and Legal

If you're thinking about buying a home there are probably a million and one questions running through your head. You may be making pro and con lists about the must-have criteria that you want in a home and a list of the things that you are willing to trade-off for other priorities. Maybe you want to buy a turnkey, ready-to-move-in new home or maybe you prefer to buy an older home and fix it up to your taste.

Older homes can be charming, and there is definitely something enchanting about living in a home with a history behind it. But there are additional costs that come with buying an owning a home that wasn't recently built.

Before buying an older home make sure to always…

Get the home inspected. It's important to know what kinds of things your home has lived through before you can move forward. A home inspection will help point out any areas of the home that need improvement, such as the foundation or electrical. A home inspection will also let you know important things like if there has been (or is) any water damage and when the roof was last replaced. Home inspectors will also check for health hazards such as mold and asbestos.

If these costs are not in your budget they can add up very quickly.

Think about the cost of home renovations. The exteriors of older homes can be very appealing, but the repairs under all the glamor can be costly. Old homes may require repairs that you can't see. For instance, when were the pipes last replaced? How old is the electrical wiring?

Consider whether the renovation costs would be worth it when it comes time to sell the place. Will you make your money back somewhere down the line?

Two things you should try to avoid when buying an older home…

Traditional heating. Older homes may use older heating methods, like oil, that can be very costly during the winter. Make sure you're considering how any older HVAC units will impact your monthly utility bills.

Upgrading to cost efficient heating such as electric can save you a lot of money over the years. If the home already has electric heating, it's a good idea to ask when the furnace was installed because a replacement furnace can cost thousands of dollars.

Lots of trees. It may sound weird, but it's true. Old homes in old neighborhoods come with old trees. Big old trees come with big old roots that have moved their way underground and possibly right into your home's foundation or plumbing. The price of removing old tree trunks and roots can quickly become very costly for homeowners.

Yes, older homes have lots of character, but depending on the types of repairs needed, they may not be a cost-effective choice. As you're creating a list of "must haves," think about a list of "no ways" too. There may be a repair needed that you can't afford or don't want to pay for, and you should know what that line is before you walk into the house and get charmed by the beams, floors, and architectural details.

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