Remember the 1986 film, The Money Pit? The romantic comedy starred Tom Hanks and Shelley Long as a young couple attempting to renovate a hopelessly dilapidated, but charming house – one that came with a ridiculously low price. It was funny, unless you were Tom and Shelley, and this was real life.
The expression ‘putting lipstick on a pig’ comes into play a great deal when buyers are looking to put a little sweat equity into a home. But what’s the difference between a fixer-upper and a money pit? Cosmetics.
Ridiculously low prices should your first red flag about what needs to be done to make a home liveable, and up to code. Major repairs or replacement of foundations, electrical panels, plumbing, the septic, or the roof can take your budget away from things like updating the kitchen and bathrooms. Instead of cosmetic fixes, you’ll be pouring your money into things you can’t see. The fun part of renovating is choosing tile, cabinetry, paint, and fixtures. Digging up an old septic, and repairing a crumbling foundation is no fun at all.
If you can do cosmetic changes to a home without breaking the bank - it’s a fixer-upper. If you have to start tearing out floors and walls to repair water damage, old wiring, asbestos, rot, unsafe chimneys, rotten windows, and moldy insulation - or, all of the above - you’ve got yourself a bit of a money pit.
The good news is, when the work is done, you’ll have a beautiful home either way. The best advice is to set a budget for your improvements BEFORE you buy – and stick to them. If you can, find a trusted contractor before you begin the process. And, a home inspection is also strongly advised. Often things like cracked foundations are hidden surprises. And, unlike discovering hardwood under old carpet – not all surprises are good when it comes to owning a 'charmer'.
The actual home from the movie, The Money Pit, sold in 2014 for $12.5 million. The Long Island home was eventually totally gutted and brought back to its original splendour, and then some. But some lipstick is way more expensive than others.
Of course, a Realtor is always there to steer you away from biting off more than you can chew. You don't want to end up arguing like Shelly and Tom, or chewing off all of your lipstick.