Tuesday, December 22, 2009, 6:33PM ET - U.S. Markets Closed.
It all seems so simple on television. You start with a well-worn house. In walks a hunky design team wearing matching polo shirts and -- presto! -- within 24 minutes there's a close-up of a beaming family enjoying their spruced-up digs.
The reality, of course, isn't so neat and pretty. First of all, thanks in part to those very TV programs, finding a fixer-upper to renovate is more challenging than ever.
| More from NYTimes.com: Housing Lenders Fear Bigger Wave of Loan Defaults At Freddie Mac, Chief Discarded Warning Signs Whole Foods Looks for a Fresh Image in Lean Times |
"Nowadays, people are watching all those shows before they put their apartment on the market," said Klara Madlin, president of Klara Madlin Real Estate in Manhattan. "You can't really find those good fixer-uppers anymore."
In addition, apartments that need work and do come on the market aren't an easy sell, brokers say. "People say they want to renovate, but when push comes to shove, they buy the renovated apartment," said Michael Carfagna, a broker and the owner of MPC Properties in Jackson Heights, Queens. "It's like the cobbler with the holes in his shoes: They know what it takes, and they don't want to deal with it."
And yet there are people who find themselves buying, if not quite down-to-the-studs fixer-uppers, places that need a substantial amount of work. They may buy these diamonds in the rough because it is the only thing they can afford, or because it enables them to get into a desired building, a coveted neighborhood or even the real estate market in general.
When financial considerations are driving these buyers, many strive for bigger savings by doing the work themselves.
Chris Schilling and Alessandra Lacavaro are first-time home buyers who married last month and had begun looking for a house in Brooklyn last summer. They figured they could afford about $500,000 for a single-family house, but were willing to spend up to $1 million for a multifamily home.
Doing renovations, said Mr. Schilling, 32, "is not something we were looking forward to, but we weren't afraid of it."
![]() Andrea Mohin/The New York Times |
| Alessandra Lacavaro and Chris Schilling, first-time home buyers, have been working on the unit’s bottom two floors since November. |
"Buying was a stretch for us," said Mr. Schilling, an analyst in affordable housing finance at Love Funding, a commercial mortgage bank in Manhattan. "We were planning on doing the work ourselves, so we had to limit it to what we could do ourselves. And we couldn't live in our old place while we worked on the new place -- it had to be a place we could move into right away while we worked on it."
In October, the couple closed on a $770,000 two-family house in Crown Heights. The rental unit, thankfully, was in good condition, and had a tenant in place. But the bottom two floors, though structurally sound, needed a lot of work: Plaster was falling off the walls, door frames needed replacing, generations of paint needed to be stripped and the kitchen needed major renovations.
After a good cleaning, the couple moved into one room in November. "At the beginning it was sort of fun, but the novelty wore off quickly," said Ms. Lacavaro, 30, who works in sales and marketing at SparkNotes, a study guides publisher. "We'd work full-time jobs, go home and immediately change our clothes and work all night. It got pretty tedious."
Currently, the couple occupies two rooms; the kitchen consists of a stove, a refrigerator and a still-in-the-box dishwasher that serves as counter space. ("It's sort of like camping, but with fridge," Ms. Lacavaro said.)
"There are some moments you think, 'It'll never be over; it will always be like this,' " she added. "But it does happen: People do finish."
Sometimes, it is difficult to fully comprehend the amount of work needed until you have actually gotten started.
When April and Bryan Jenkins first began looking for a Park Slope apartment three years ago, they were thinking new construction. But as the years passed and they had a child, it became apparent that their budget of about $650,000 was no match for the escalating real estate market and their increasing space needs.
| More from Yahoo! Finance: • One-of-a-Kind Mansions at Bargain Prices • Top U.S. Real Estate Markets for Investment • Vacation Homes on the Cheap Visit the Real Estate Center |
When their daughter, Sylvie, was born two years ago, a new three-bedroom condo in the area was priced at $800,000 or more -- a financial impossibility. Their search dragged on, and this spring, some friends directed them to a three-bedroom, two-bath listing for $699,000 in the South Slope.
Though the space and the layout was perfect -- along with the location and school district -- the condo, Mr. Jenkins said, was not. The bathrooms were outdated and filthy, the kitchen dated from the 1980s, and the living room walls were painted fluorescent yellow. Needless to say, they weren't interested.
Then the price on the condo dropped to $669,000. It became hard to pass up. Figuring the cost of renovations at about $35,000, the Jenkinses offered $625,000, ready to walk away if their offer was rejected.
"It felt like it was a decision we were making with our minds, not our hearts," said Mr. Jenkins, 32, creative director at the James Group, an advertising agency in Manhattan. "But the sellers came back and said O.K."
"And we were like, 'Uh, O.K.' " said Ms. Jenkins, 34, who is a freelance photo editor.
Page 1 | 2
See today's average rates across the country.
| Loan Type | Today | Last Week |
|---|---|---|
| 30 Year Fixed | 5.11% | 5.07% |
| 15 Year Fixed | 4.48% | 4.55% |
| 1 Year ARM | 3.91% | 3.94% |
| 30 Year Fixed Jumbo | 5.90% | 5.86% |
| 5/1 ARM | 4.25% | 4.19% |
| 3/1 ARM | 4.94% | 4.97% |
| Loan Type | Today | Last Week |
|---|---|---|
| $30K Home Equity Loan | 8.38% | 8.34% |
| $50K Home Equity Loan | 8.28% | 8.22% |
| $75K Home Equity Loan | 8.31% | 8.25% |
| $30K HELOC | 5.17% | 5.19% |
| $50K HELOC | 4.91% | 4.93% |
| $75K HELOC | 4.91% | 4.93% |
| Loan Type | Today | Last Week |
|---|---|---|
| 36 Month New Car Loan | 6.71% | 6.70% |
| 48 Month New Car Loan | 6.84% | 6.82% |
| 60 Month New Car Loan | 6.88% | 6.86% |
| 72 Month New Car Loan | 6.12% | 6.12% |
| 36 Month Used Car Loan | 7.17% | 7.17% |
| 48 Month Used Car Loan | 7.05% | 7.05% |
| Card Type | Today | Last Week |
|---|---|---|
| Business Credit Cards | 10.74% | 9.74% |
| Low Interest Credit Cards | 11.97% | 11.75% |
| Balance Transfer Credit Cards | 12.09% | 12.20% |
| Cash Back Credit Cards | 12.49% | 12.08% |
| Instant Approval Credit Cards | 13.32% | 13.32% |
| Reward Credit Cards | 13.42% | 13.29% |
Historical chart data and daily updates provided by Commodity Systems, Inc. (CSI). International historical chart data and daily updates provided by Morningstar, Inc. Fundamental company data provided by Capital IQ. Quotes and other information supplied by independent providers identified on the Yahoo! Finance partner page. Quotes are updated automatically, but will be turned off after 25 minutes of inactivity. Quotes are delayed at least 15 minutes. Real-Time continuous streaming quotes are available through our premium service. You may turn streaming quotes on or off. All information provided "as is" for informational purposes only, not intended for trading purposes or advice. Neither Yahoo! nor any of independent providers is liable for any informational errors, incompleteness, or delays, or for any actions taken in reliance on information contained herein. By accessing the Yahoo! site, you agree not to redistribute the information found therein.
Yahoo! Answers is provided for informational purposes only, and no Q&A is intended for trading or investing purposes. Yahoo! shall not be responsible or liable for the accuracy, usefulness or availability of any Q&A information, and shall not be responsible or liable for any trading or investment decisions based on such information. View Complete Answers Disclaimer.