10 Reasons to Buy an "Ugly" Home

10 Reasons to Buy an "Ugly" Home

Improving an Ugly Home Homes that are attractive, with good designs and curb appeal are always the first to sell while commanding high offers in most any market. Home buyers who want or need to save substantially on the purchase of a home should consider homes that are less attractive, but still have potential for improvements.

These "ugly homes" can be a great way to maximize housing budgets, and here are ten good reasons why this may be the case.

1: Lower Purchase Price

Ugly homes and those that languish unsold in an otherwise active real estate market have something in common - a seller who needs to sell. When sellers are in this position, buyers can often expect to pay a lower sales price, sometimes well below the market average.

However, buyers considering one of these homes should always take time to discover the real reason or reasons why the home has not sold, before making an offer. If there are major structural issues, even an ugly home at a great price may not be a good deal.

2: Seller Credits 

When working with the seller of an home, buyers may ask for some type of seller credits when making their purchase offer. This can be a painless way to add extra funds to the buyer's repair or renovation budget and something that sellers may be willing to do in order to make the sale. 

3: Seller Financing

Another potential benefit that can often be had when buying an ugly home is the potential for seller financing. Ugly-home sellers know that banks may be unwilling offer buyers loan approval for the home in its current condition and savvy sellers are often willing to hold the note - and collect the interest - in order to get the home sold.  

4: Potential to Add Square Footage

Homes that are older, especially those built several decades ago may be located on larger lots than those where newer homes are located. This extra space often provides excellent potential to improve the market value of the home by adding extra bedrooms, bathrooms or other living spaces. Buyers should refrain, however, from over-improving the home in order to maintain the ability to resell without taking a loss on the value.

5: Historical Value

Some ugly homes have potential for historical value but have been devalued due to their rundown condition. This situation often occurs when the seller is selling an older home that has been inherited from a parent, grandparent or other older relative. Rehabbing homes with historical value, such as once popular kit homes, can yield magnificent results, especially for the buyer with time and money to do the rehab. 

6: Potential for Modifying the Floor Plan

Whether it is a bathroom that was added as an afterthought or bedrooms that must be accessed through another room, many homes are considered ugly simply because they suffer from floor plans that leave a lot to be desired. When this problem has caused past buyers to lose interest, sellers are often motivated to lower the price in order to attract a buyer willing to either modify the floor plan or live with it, as is. 

If you can see potential in the floor plan of a fixer-upper that doesn't seem like too much of a money-sink renovation, you may be able to add considerable value to the home. 

7: Fast Closings

Sellers of less-than-desirable homes, especially those who are trying to sell a home that is already vacant are prime candidates for agreeing to a faster than average closing. Buyers who must move by a certain date can often do so and get a great price on a home by choosing an ugly home that will need a bit of cosmetic love. 

8: Landscaping Benefits

Older homes are often the ones in need of renovations or repairs. In many cases these homes offer beautiful mature trees and established lawns that newer homes may not. 

9: Location Benefits

Even though an ugly home may need repairs or renovations, it may be a way for buyers to afford a home in areas of their city they may not otherwise be able to afford.

10: Rising Home Valuation

By purchasing and renovating an ugly home, especially when they can cash flow the costs of the renovations, buyers can reap the benefits associated with a lower home mortgage payment while living in a home with a rising home value. 

If buying an ugly home appeals to you, ask your real estate professional to help find and view the homes that offer the best potential for a low purchase price and high returns on your purchase and renovation investment. Their experience and guidance can help you avoid expensive mistakes and maximize your housing budget. 

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