Is a Fixer-Upper House
The Right Buy for You?

Question: I want to buy a home in a neighborhood with really good schools, but the prices in these areas are simply too high. I just found a fixer-upper that might work financially. What are the pros and cons of buying a "handyman's special"?

-- Adrian, Louisville, Ky.

Adrian: Sometimes a fixer-upper is the only way you can afford to get into the neighborhood you want. The idea is to get a lower price because the house is in bad shape, then spend time and effort putting it back into good working order. Rather than spend money on the house, you spend "sweat," which makes the home more affordable. But before buying, be sure you know what you are getting into. Get a thorough home inspection and study the buyer's disclosures so you know what the home's real problems are.

If you are the sort who doesn't like working up a sweat or doing work around the house, then stay away from the home you found. Remember, this is a property that needs lots of TLC. It will probably require you to get in there and get your hands dirty. You will find yourself painting, cleaning, hammering -- and much more. Chances are it will occupy a substantial portion of your time for at least a few months until you get it whipped into shape. Working on a fixer-upper can be a drain on an otherwise active lifestyle.

On the other hand, most people I know who have bought such homes say the experience was one of the best of their lives. Indeed, some couples say working on a house helped bring their marriage together! I have worked on more fixer-uppers than I care to count, and have always had an enjoyable experience. People who pursue these projects often gain a sense of accomplishment from putting something that was run-down back into shape -- and very possibly making it even better than new!

Beyond the emotion and time you need to invest, however, there also is a complex financial commitment involved. Not only do you have to come up with the cash and financing to buy the home, but you need to have the money to make repairs once it is yours. In addition, you might need to find another place to live while you are doing the work because you can't always count on being able to live in the home while repairs are being made.

If you have some available cash, you may want to consider taking on such a project. But if you are cash and credit poor, a fixer-upper might not be the best route for you.

-- Mr. Irwin has more than 25 years' experience as a Los Angeles-area real-estate broker. He is the author of more than two dozen books about real estate and is recognized as one of the most knowledgeable writers in the real-estate field. Mr. Irwin's most recent book is "Tips and Traps When Renovating Your Home," (McGraw-Hill, 2000).

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