I Want to Buy a House, but It Needs Some Major Repairs. Is It Worth It?

‘The Big Move’ is a MarketWatch column looking at the ins and outs of real estate, from navigating the search for a new home to applying for a mortgage.

Dear MarketWatch,

I want to buy a home that needs a lot of repairs and renovations, but I’m almost 50 years old. Is it worth it? How long does it take for home improvements to pay off?

Sincerely,

Fixed on a Fixer-Upper

Dear Fixed,

If you watch a lot of shows on HGTV, the idea of buying a home in need of some TLC for a bargain and sprucing it up sure can sound appealing. Many among us fantasize about embracing their inner interior designer, taking a rundown home and giving it the Chip and Joanna Gaines treatment. In the interest of honesty, I’ll admit that I’m guilty of such day dreams.

I can say with a fair degree of confidence that you already have the right instincts here. There are plenty of reasons to be skeptical about taking on such a huge project. The biggest one: They don’t usually pay off.

Smaller-scale home-improvement projects might have a better return on investment. For instance, a can of paint or two costs hardly anything, and research shows that painting the rooms in your house the right color can add as much as $3,000 to the home’s sale price.

With anything bigger than that, you’re unlikely to recoup your investment. Remodeling Magazine each year puts out a list of the home upgrades that fetch the biggest returns. The 2020 edition of this report showed that on average not a single home-improvement project sees a 100% return. The closest you could come — adding a manufactured stone veneer to your house — was a 96% return on average. And in most cases, the returns on renovations had fallen between 2019 and 2020.

Americans generally view owning a home as a financial investment — and the four-bedroom home with a white-picket fence surely factors in the American Dream. Many people go into homeownership hoping to see their equity grow over time — with the goal of passing that money onto their children or using it as a cushion in retirement. But when you compare real estate to other assets, it’s clear that owning real estate is more complicated than that.

“Many financial investments will grow as fast, or faster, than personal real estate and be far more flexible if you need any access to liquidity along the way,” said Sean Pearson, a Pennsylvania-based financial adviser and associate vice president with Ameriprise Financial Services. “If you live in your house long enough, and you sell during certain types of markets, depending on interest rates, you might see a positive ROI from your home. But that could be a long way from now, and requires a lot of things to happen along the way.”

Instead of approaching buying a home with an investor’s mindset, I suggest you consider the myriad other reasons why homeownership can be beneficial. Owning a home allows you to take control over your housing costs. Sure, the property tax bill or utility rates may vary over time, but you won’t need to worry about a landlord jacking up the rent unexpectedly. And the equity in your home — if used appropriately — can become a useful financial tool to consolidate other debts or finance a child’s college education. (Again, approach cashing out home equity with caution.)

You’re almost 50 — and maybe a decade or so away from retirement. Think about whether this home could be your forever home. If you’re making major renovations, you could really ensure that this home would be one you could live in for the rest of your days by approaching those repairs with accessibility in mind. If you can afford major home improvements, and they’ll enrich your quality of life, it’s hard to put a price tag on that.

Or you might decide that owning a home isn’t worth it. There is a benefit, after all, to being able to rely on a landlord or property manager to handle upkeep. And in many parts of the country, renting a home and using your remaining money wisely could be a better deal that becoming a homeowner.

Whatever path you choose to take, I encourage you to keep trusting your gut. It’s not led you astray so far.

Source: realtor.com

‘Fixer Upper: Welcome Home’: Chip and Joanna Gaines Made ‘Fixer’ History Breaking 1 Personal Rule – Showbiz Cheat Sheet

Chip and Joanna Gaines are returning to television with Fixer Upper: Welcome Home. The home renovation show is back and bigger than ever to change people’s lives. On one of the episodes released on the Discovery+ app, the couple made history showcasing something they had never shown during their renovations. To make this moment happen, the Gaineses had to break a rule they implemented in their own homes.

Chip and Joanna Gaines
Chip and Joanna Gaines | Nathan Congleton/NBCU Photo Bank/NBCUniversal via Getty Images via Getty Images

Chip and Joanna Gaines are doing ‘Fixer Upper’ again

Fixer Upper is back with Chip and Joanna Gaines renovating homes once again. The couple is ready to launch their own channel slated to debut on TV in January 2022. However, Discovery+ subscribers have been able to get a sneak peek of their new show called Fixer Upper: Welcome Home as part of the Magnolia Network preview.

After ending their run on HGTV and producing 79 episodes for the network, the couple thought they were done. However, with the launch of their own network, they wanted to share those stories that touched people’s hearts once again and the reboot was born.

“The day we wrapped our final episode of Fixer Upper, we really believed it was a chapter closed. We knew we needed a break and a moment to catch our breath. But we also knew we weren’t done dreaming about ways to make old things new again,” Chip and Joanna said in a statement. “These past few years, we’ve continued tackling renovations and projects, doing the work we’re passionate about, but I don’t think either of us anticipated how the show would become such a permanent fixture in our hearts. We’ve missed sharing the stories of these families and their homes with you, and we’re excited to do that again very soon!”

Chip and Joanna Gaines
Chip and Joanna Gaines | Daniel Zuchnik/WireImage

RELATED: ‘Today’: How Joanna Gaines Talked to Her Kids About the Coronavirus Pandemic

Chip and Joanna Gaines don’t own a TV

One thing that fans have noticed about Fixer Upper is that a TV is never featured in their renovating projects. This is possibly due to a personal rule they have in their own family. Chip and Joanna don’t own a TV and have strict rules about using an iPad.

“Our rule for the iPad is that the kids can use it a certain amount of time every other day,” Gaines told Southern Living magazine in their March 2019 issue. “It’s contingent on them doing their chores and homework. I try hard to make it not the thing they look forward to every day. I don’t want them focusing on that.”

Joanna says that without screen time, their kids “create and invent [things] on their own” to keep entertained.

Chip and Joanna Gaines
Chip and Joanna Gaines | Nathan Congleton/NBCU Photo Bank/NBCUniversal via Getty Images via Getty Images

RELATED: Martha Stewart Blasts Chip Gaines for ‘Made up Story’ and the ‘Fixer Upper’ Star Fires Back

Chip and Joanna Gaines break the rules

On the second episode of Fixer Upper: Welcome Home, Chip and Joanna have the task of helping out John transition from New York City to Waco, Texas. John works for the couple and one of his requests was to be able to see a TV right from his office inside his home.

“When you’re in this space, do you want to be able to see the window of your dreams and the kitchen of your dreams or do you want little closed-off sections?” Joanna asked John while in the living room.

“When I’m in this room, I would like to see the TV of my dreams,” John replied.

To accomplish this task, Joanna broke down the wall separating the living room from his new office and put a window that served as a wall. The TV was then placed on top of the chimney. During the revelation of the home, Chip and Joanna pointed out that it was the first time they included a television in the home decor.

RELATED: All the Episodes of ‘Magnolia Table With Joanna Gaines’ Are Now Available To Watch on Discovery Plus

“First time in ‘Fixer’ history we’ve done….,” Joanna started to say before being interrupted by Chip adding, “Don’t tell him, see if he can guess it….”

“Oh, I already know what it is. First time we’ve ever featured a television in a ‘Fixer Upper’ house.,” John said.

“And I did it for you,” Joanna added.

Despite Chip and Joanna not owning their own TV, they honored their clients wishes in integrating a television in his new home.

More episodes of Fixer Upper: Welcome Home will be available on Discovery+ and a new Magnolia Network app starting in July.

Source: cheatsheet.com