Pro: Lower cost and you can fund the renovations over time
One big benefit of renovating is that you can pay for the renovation over time.
The up-front purchase price of a fixer-upper can be much cheaper than buying a new build or an existing home in great condition. In fact, research from Frontdoor has shown the average fixer-upper could be priced as much as 64.7% less than the average non-fixer-upper in some markets.
Buyers on a budget can purchase an affordable fixer-upper and pay for renovations over time through savings or borrowing against equity. Those with the knowledge and ability to do so can also earn sweat equity by doing some of the work themselves. This is what the Grissom family did.
"Funding the renovation was definitely a concern," Stacie said. "But, we also knew that we were really scrappy in the way that we were going to build out our kitchen and do a lot of the work ourselves over the years."
With mortgage rates remaining near record highs, being able to get into a home now and pay to improve it over time may be especially attractive.
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Learn MorePro: You can benefit from old-world craftsmanship
Many old homes and buildings contain features and details you might not see in today's modern homes.
The Grissoms were attracted to the charm of the old schoolhouse, keeping some of the original painted walls and the original brick. With the high cost of modern materials and the higher costs of labor, recreating some of these old-world details in modern construction is difficult or impossible.
For any homebuyers who love things like original woodworking, old cast iron stoves or old pocket doors, buying an older home may be the best option.
Con: It could take awhile to be done
A renovation may allow you to put your stamp on a property and truly make it your own in a way that moving into an existing house won't. But this will take time.
The specifics of the timeline will depend on how much renovation is needed, of course. For the Grissom family, it took three years for the schoolhouse to become livable and move-in ready.They initially thought it would take just two years. “In terms of the renovation being fully complete, I don’t know if it will ever be,” said Stacie.
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Discover the secretCon: You could face cost uncertainties
Finally, there can be cost uncertainties with a renovation because it's hard to know what happened to the house before you got there.
You could, for example, buy a fixer-upper anticipating just doing some minor cosmetic work but then get into the home and discover when you open the walls that the house is full of lead pipes that need replacing or that the electrical wiring is faulty.
Having a home inspection before buying can help you minimize some of these issues, but whenever you have an older structure to work with, there's always the potential for surprise problems to come up.
Ultimately, you'll need to decide if you prefer the charm and uncertainty of an older home to renovate, the simplicity of buying a move-in-ready existing home, or the flexibility of building brand new. There are advantages and disadvantages to each choice, so it just depends on what's best for you given your budget and your design plans.
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