I Would Never Buy a Home With These 3 Issues

When you buy a home, you take on more than just a monthly mortgage payment. You also have to deal with peripheral expenses like property taxes, homeowners insurance, and upkeep. These are all expenses homeowners know to prepare for. But one additional expense that might really throw your finances off-course is the cost of making repairs.

When you buy a home, needing to make repairs at some point is pretty much inevitable. But some can be expensive beyond belief. That's why in the course of buying, it's pretty important to have your home undergo a thorough inspection. And you should attend that inspection so you can ask questions if issues are pointed out.

Now, it's not unusual for a home inspector to find minor issues during their examination. But if I were to discover these three issues during a home inspection, I'd immediately back out of the deal (which you can do as long as your contract has a home inspection contingency) and look elsewhere.

1. Foundation damage

A cracked foundation is a problem because, well, your foundation anchors your whole house. And the reason I wouldn't buy a home with foundation damage is that the cost to address it could be exorbitant.

Angi puts the average cost of foundation repairs at about $5,000. But it also notes that the cost could reach $15,000 on the high end. And I happen to know someone who recently spent over $20,000 on foundation work after buying a home.

Because it can be so hard to estimate the cost of addressing this particular issue, it isn't one I'd knowingly take on. It's one thing if you find out you're buying a home with a failing air conditioning system and it'll cost $7,000 to $8,000 to replace it. That's a more narrow range. But I wouldn't take on a repair where it's hard to estimate the final cost until you start the work, which is often the case with a damaged foundation.

2. Outdated electrical work

Rewiring a house is a big deal. And because of that, I wouldn't be willing to buy a home that wasn't already up to code.

Angi puts the cost of upgrading wiring at $200 to $2,300. It also says that the cost to upgrade a circuit breaker box costs $1,150 on average, while upgrading electrical outlets costs about $2,000.

But in reality, the cost of fixing outdated electrical work may be much higher. In addition to these costs, you might have to pay to fix the walls you inevitably have to break up to access your wiring in the first place. And you also have to then think about repainting them.

Plus, frankly, I would not feel comfortable living in a home even for a short period of time that wasn't up to code. It's a scary, hazardous situation that would definitely keep me up at night.

3. A termite problem

Much of the time, when you buy a home, you're going to have to deal with a pest control issue at some point. A few years back, we had to pay a few hundred dollars to address an invasion of mice (thankfully, we think we found the source and blocked it off). And these days, I pay about $500 a year to have my home sprayed for ants every few months.

But one issue I would not be willing to deal with when buying a home is a termite problem. Termites can cause a world of damage, and like foundation repair, the cost to address the problem can vary substantially.

Angi puts the average cost of termite repair at $3,000 but acknowledges that the range of the cost to fix the problem starts as low as $250 and goes as high as $37,500. And the latter is a lot of money. Plus, you then have to take steps to prevent future termite damage once you've addressed the initial damage.

Always have savings when you're buying a home

Whether you're buying your first home or your fifth, there are certain issues you may want to write off as deal-breakers from the start. And you may want to consider putting the above items on your list to avoid a huge financial hassle.

That said, it's super important to have a fully loaded emergency fund as a homeowner, because you never know what issue might arise out of the blue. Remember, your home inspection gives you a snapshot of the condition of your home at that moment in time. A year or two later, things could go very wrong.

So always have cash reserves as a homeowner, and also, do yourself a favor and factor the cost of minor repairs into your monthly budget. That way, you won't have to pull from your savings account every time there's a small issue, leaving you with more money in the bank to tackle the really big ones.