Is Rehabbing a Home the Right Move for You?

You’ve found your dream home in beautiful New Orleans, Louisiana. It’s in the perfect neighborhood, has a lush garden, and it’s close to where you work. You’re surrounded by neighbors who you’re preemptively making friends with. The only problem? It’s not livable yet.

In contrast to a fixer-upper – which needs a few minor repairs but could still house a person comfortably – a rehab home needs serious work, like a brand-new plumbing system or roof. However, this also allows you to customize the house from the ground up, giving it a modern twist while preserving its historic qualities. Is rehabbing a home the right move for you?

The Messy Side of Rehabbing a Home

Before you sign any paperwork, take a moment to consider some of the potential snags you might encounter on the way. Although not as fun as jumping straight into demolishing walls, it’s important to consider the cons as well as the pros, because remodeling a house from scratch is a big project.

1.   Renovations Take Time

Remodeling a house from the ground up can take months. You may be putting in new electrical wiring or repairing extensive flood damage. You’ll probably also be hiring people to work for you, and they may run into delays due to illness or family emergencies.

Even the weather can affect renovation timelines. A rainy, muddy mess will hinder the movement of vehicles and materials. Be patient! It will all be worth it in the end.

2.   It Can Be Pricey

In addition to the base price of the house, you might be shelling out tens of thousands of dollars for repairs. The cost of construction materials is high in 2022, so you’ll be paying more for lumber and plumbing fittings. You may also have to pay to haul trash and demolition debris to a dump.

You’ll need to budget for the construction workers, electricians, and real estate agents helping with your project. It’s important to consider that you might also be paying rent or a mortgage on your current house, too, so you should add that to your total cost estimate. Still, if you can flip the house and sell it for more than you paid for it, it’s a great investment.

3.   It’s Harder to Get Financing

It’s risky for banks to mortgage a rehab home, so not all of them will do it. You’ll also need to find a way to finance the renovations, and your lender might not allow you to do the renovations yourself.

4.   You Can’t Move in Yet

Where will you live while you’re renovating the new house? Active construction zones aren’t the most comfortable place to sleep, and there’s also the issue of the toilets potentially not being installed yet.

If you’re buying a new house because you need to move for work or your family is growing, you may have to wait a few months for the new house to be finished first. However, this isn’t a problem if you’re planning to sell the freshly renovated house.

The Benefits of Rehabbing a Home

With every floorboard you pull up, you’re uncovering a layer of history. Countless stories have been told, and lives have been lived in old houses, and restoring it to its original beauty respects the people who once called it home. It’s a noble project to take on.

1.   A Historic House Has Character

The old woodwork, antique light fixtures, and hastily added spare bedrooms lend a certain charm to historic houses, which are defined by being more than 50 years old and meeting the requirements of the National Register of Historic Places.

Even if the home you’re planning on rehabbing doesn’t fit these criteria, it’s still rich in history. So much has happened inside it over the years! It might have survived Hurricane Katrina, housed the great-grandchild of a coal miner, or borne witness to a backyard wedding.

Delving into the stories of the house as you remodel it is fascinating and makes you feel a connection to the former occupants.

2.   The House Is Yours to Customize

Although you’ll still likely want to preserve the house’s character, you can add your own custom touches to it once it belongs to you. Whether you want reclaimed maple countertops, a marble slab island, modern light fixtures, or Mason jar porch lights, you make the decisions when it comes to decor.

3.   The Market Is Less Competitive

Most people are looking for a move-in-ready house and not many people have the budget, time, or desire to carry out extensive repairs. If you’re in the lucky position of being able to rehab a house, you’ll find there are many available on the market.

4.   You Can Flip or Rent the House

When you’re done, you can sell the house for a profit or rent it out to get a return on your investment for years to come. As long as the cost of repairs is reasonable, if you bought the house for $50,000 in a neighborhood that regularly sells houses for upwards of $150,000, then you could be making a sizable profit.

5.   The Process Is Fulfilling

Through blood, sweat, and paint, you turned an unlivable building back into a home. That’s a serious accomplishment! When the wallpaper is up, and the last nails have been hammered in, you can look at the house and know that it’s essentially been made new.

The Choice Is Yours

It’s a massive undertaking, but restoring an old house to its former glory is a rewarding and satisfying project – especially in a place with as rich a history as New Orleans. At the end of the day, given a choice between a turnkey house or a diamond in the rough, you get to decide: Is rehabbing a home the right move for you?

*Written by Rose Morrison renovated.com