4 Signs a New Home Could Turn Into a Money Pit
by Christy Bieber | Published on Oct. 10, 2021
Buying a new home? Make sure it doesn't end up costing you more than you expect.
When you purchase a home, ideally, you'll have a good idea of costs up front. You'll need to estimate your mortgage payment, including your principal, interest, property taxes, and insurance costs. You'll also want to think about routine maintenance and home repair costs.
Unfortunately, sometimes those repair costs can get out of control, turning your home into a money pit. While it can be difficult to know when this will happen, watch out for these four signs that your house could end up costing you a lot more than planned.
1. The current owners discourage an inspection
If the home sellers don't want you to have the house inspected, this could be a sign they aren't being forthcoming about the property's problems.
You need to insist on having a qualified inspector check out the home to identify serious issues such as mold, a leaky roof, or a damaged foundation. You don't want to be caught off guard by homeowners eager to unload a house with tons of hidden issues.
2. The house is older and major systems haven't been updated
Some parts of a house can be very expensive to repair -- especially if you have to bring them up to current code or because insurance companies or your county require it. For example, replacing an electrical system, plumbing, HVAC, or roof can mean spending tens of thousands of dollars -- and often having to tear out walls and floors.
Buying a fixer-upper without modern upgrades might make sense if you get a great price and have the know-how to estimate how much repairs will be. But be prepared for these projects to be a major -- and costly -- undertaking that may grow even more expensive if surprises are found once you get started.
3. The house was badly built
Whether a home is old or new, shoddy construction can lead to a host of problems down the line. Unfortunately, it can be difficult to tell from a surface examination of the home whether corners were cut that will lead to costly issues in the future.
An inspector can sometimes shed light on whether the construction materials and workmanship are top quality or whether you could face unexpected expenses after you buy. You may also want to see if you can find out who the original builder was and look for bankruptcies, lawsuits, or poor reviews regarding their work.
4. There's lots of deferred maintenance to be done
If you look around the home and there appears to be lots of little problems such as cracked tiles or leaky faucets, this could be a big indicator that the current homeowners didn't take good care of the property.
While these cosmetic repairs may not be expensive to deal with on their own, if there is a lot of deferred maintenance, it may have compromised some of the home's major systems. Again, an inspector can help you identify whether this is the case. But you should look with an especially close eye at any house where the homeowners don't appear to have invested much in maintaining it.
By watching for these red flags, hopefully you can end up with a home that you're happy with -- and not one that drains your bank account.
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