Should You Buy a Fixer-Upper or Move-In Ready Home?

Compare the pros and cons for your first home

A person paints a wall in a house.

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If you're in the market to buy your first home, a fixer-upper can seem enticing. These properties come with steeply-discounted prices because they need a lot of repairs or upgrades. In today's market, where saving to buy a house is a challenge for many people, affordability is a major advantage of fixer-uppers. Other buyers may be interested in the potential profits of flipping homes, perhaps inspired by reality TV shows.

On the other hand, the appeal of a move-in ready home is undeniable and might even come as a relief after a long home-hunting process. If you buy a house that's ready for move-in, you won't need to wonder how much you'll spend on renovations or how long they will take.

Whether you're looking for a fixer-upper or a move-in ready home, there are upsides and downsides. Learn more about the specific challenges of each type of home, so you can decide which is the right kind of right property for your first home.

Key Takeaways

  • Buying a fixer-upper can be a more affordable choice for your first home.
  • Fixer-uppers require more preparation, work, and time than buying a move-in-ready home, and they may have hidden costs.
  • You can finance home improvements in several ways, including through special mortgages or personal loans.
  • If you can't complete the work yourself, you'll need a reliable contractor for repairs or renovations.

What's the Difference Between Fixer-Uppers and Move-In Ready Homes?


A fixer-upper is property that requires substantial repairs or updating to make it comfortable. It is generally sold for less than a similar home in better condition. It can also be called a "reno," "distressed property," "fix-and-flip property," "flipper house," or "rehab house."

"It is a much longer process than what they show you on TV,"  Mindy Jensen, community manager for real estate investment website BiggerPockets, told The Balance. Jensen is also a real estate agent who flips houses herself. "And they're not showing you all the problems that they found."


Fixer-uppers can require major repairs, such as replacing walls, floors, or a roof. Or, they may need less-extensive work, such as painting or redecorating. They’re usually sold at lower prices because of the extra time and costs needed for upgrades on the property.

People often buy a fixer-upper because they want to save money on their home, or they want to profit by renovating and reselling it.

Move-In Ready Homes

The term "move-in ready" may be a slight misnomer, as it covers many degrees of readiness, but in the most simple sense, a move-in ready home is one that needs very little to zero maintenance before the new homeowner can move in. Many have been newly renovated in order to be competitive in the market. In theory, if you buy a move-in ready home, you should be able to start loading your furniture in and living there soon after you close escrow.


Model homes in subdivisions or condominium complexes are occasionally sold to homebuyers and, in some cases, may even come with model furniture and decor.

Pros and Cons of a Fixer-Upper

Homebuyers can find substantial savings when they buy a fixer-upper, but they also can run into major challenges that can cost time and money. Here are some pros and cons of buying a fixer-upper as your first home:

  • Less-expensive purchase price

  • Availability of special mortgage programs

  • More room for creativity and customization

  • Can be difficult to find

  • Can cause stress

  • Could cost more than expected

  • Requires construction skills or a contractor

Pros Explained

  • Less-expensive purchase price: Fixer-uppers generally are much cheaper than similar homes that don't need as many repairs. Remember to factor in the cost of the renovation when calculating your total savings.
  • Availability of special mortgage programs: There are many ways to finance the improvements needed for a fixer-upper. For example, special financing programs allow you to roll the renovation costs into the mortgage.
  • More room for creativity and customization: When you complete substantial renovations, you can customize the space how you like.

Cons Explained

  • Can be difficult to find: You can find fixer-uppers on a Multiple Listing Service (MLS) via a real estate agent, home listing sites such as Zillow or Trulia, or through off-market listings. Finding the right fixer-upper for you can take more time because they are less common.
  • Can cause stress: Renovating a home can be frustrating and even strain relationships if you're working with a friend or family member.
  • Could cost more than expected: Many times, a remodeling project does not go according to plan, said Jensen. Home upgrades frequently take far longer and cost more money than you expect.
  • Requires construction skills or a contractor: If you're not handy with tools, you'll need to hire a reputable contractor. Researching contractors in your area requires time if you don't already have an established network.

Pros and Cons of a Move-In Ready Home

  • Predictable costs

  • No wait to move in

  • More expensive

  • Difficult to customize

Pros Explained

  • Predictable costs: When you buy a move-in ready home, you know that the crucial utilities like electric and plumbing systems are intact and working. Prior home inspections during the homebuying process will also have cleared any potential structural issues. So chances are there will be no surprise maintenance needs after you move in, and any extra costs will be at your discretion.
  • No wait to move in: Move-in ready homes are often newly renovated. You won't need to wait for a renovation team to paint cupboards or install carpet. You can move in right away.

Cons Explained

  • More expensive: Convenience comes at a cost. When you buy a move-in ready home, you'll pay much more than a fixer-upper with similar size and features in the same location. Many sellers will actually renovate their homes before putting them on the market in order to bump up the sale price.
  • Difficult to customize: It is not unheard of to want to apply custom features to a move-in ready house or to renovate it after you buy it, but a move-in ready house does not have the same "blank slate" appeal of a fixer-upper. In other words, it may be hard to justify tearing down walls or reflooring when the existing walls and floors are just fine.

How To Shop for a Fixer-Upper

Buying your first home is a learning experience. However, if you plan on buying a fixer-upper, be prepared for a significant amount more work than the standard buying process for a move-in ready home.

Find a Fixer-Upper

Your first challenge is finding a fixer-upper to buy. You can turn to the Multiple Listing Service (MLS) through a real estate agent or review home listing sites such as Zillow or Trulia. You could also review postings on Craigslist or sites for local for-sale-by-owner properties.

One strategy many real estate investors use is to drive around neighborhoods they're interested in and look for potential fixer-uppers.


If you find a property that looks in less-than-perfect condition, you can find out who owns it via public records. You can also see whether it has been recently sold or not. You could send the owner a letter letting them know you're interested in buying the property.

Assess Renovation Requirements

Fixer-uppers can be more expensive than buying a home in good condition if you don't plan properly. In some cases, a home may require more work than you can afford or than you have time to invest. How do you know if a particular fixer-upper is right for your budget?

To get a general estimate, assess the property in detail before you agree to buy it, perhaps with the help of a real estate professional and a certified home inspector. Take a full inventory of what improvements it will need.

"Start with the big things," Jensen said. "Does the furnace work? What about the roof? Go into the basement or crawlspace and really look at the walls. Do you see cracks that have broken apart and shifted?"

Estimate Costs and Time To Complete

Once you know what needs to be done, you'll need to estimate how much time and money it will take to fix those things, whether you're doing it yourself or hiring a contractor, Jensen said.

Estimate the cost of each improvement, then weigh the total costs against your savings on buying a similar property that doesn't need upgrades. If you're buying a home to flip for profits, you'll want to dig deeper into the cost of a particular renovation compared to what it adds to the resale value.


If you can't do the work yourself, get cost estimates from contractors, and factor those expenses into your total home-improvement budget.

How To Finance a Fixer-Upper

There are many ways to finance a fixer-upper, including special mortgages, loans, or grants. There are multiple ways to finance move-in ready homes as well, but not the same niche programs are accessible to fixer-uppers. Here are some examples of common programs that can help finance a renovation project.

FHA 203(k) Rehabilitation Loan

The U.S. Department of Housing and Urban Development offers two types of loans for rehabilitations through its 203(k) Rehabilitation Loan Program. The standard 203(k) mortgage allows homebuyers to finance major repairs of at least $5,000, including a demolition.

The Limited 203(k) mortgage allows buyers to finance up to $35,000 into their mortgage for upgrades and repairs. You can use the funds, for example, to make cosmetic repairs such as installing new carpets or repainting.

Fannie Mae HomeStyle Loan

Fannie Mae's HomeStyle loan provides financing for up to 75% of the as-completed home value, and it can be used for any project. It can be used to finance accessory projects such as in-law suites or basement apartments.

VA Loan

Mortgages with the U.S. Department of Veterans Affairs have a number of perks, including the ability to roll renovation and repair costs into a home loan. You'll need to be a service member, veteran, or surviving spouse of a veteran to secure these loans.

Other Financing Methods

You may prefer to use a personal loan, although this typically comes with a higher interest rate than mortgages.


You could finance a renovation with a credit card that offers 0% APR for a limited time. If you pay it off by the end of the promotional period, you'll essentially have a free loan. If not, however, you could face a significantly higher interest rate than you would with other financing options.

Many home improvement stores offer deferred-interest credit cards that work similar to 0% APR cards. If you pay them off in time, you won't owe interest.

The Bottom Line

Buying a fixer-upper as your first home can save you substantial money, so it can be ideal for people on a tight budget. If you prefer to avoid the work and are willing to pay a higher price, a move-in ready home might be more your style.

Either way, keep your budget in mind when planning upgrades and renovations so that the costs don't exceed your savings. If you enjoy home-improvement projects or want to earn profits by flipping homes, a fixer-upper can be a good choice. "You can buy a rehab and have success doing it," Jensen said. "It depends on the level of your experience, your level of handiness, [and] the level of rehab necessary for the house."

Be honest with yourself about your level of expertise and your ability to handle stress. "It won't go according to plan," Jensen said. "It will definitely take longer than you think, and it will cost more."

Frequently Asked Questions (FAQs)

What should I start fixing first after buying a fixer-upper?

After you've gutted out what you'll be replacing, consider starting with painting the walls, replacing flooring, or any other projects that might create fumes. That way, you'll have more time to air out the home before you move in. Make sure basic systems such as plumbing and heating are functioning safely before you move in.

Can I get a larger loan when I'm buying a fixer-upper?

Yes, you can get a larger mortgage with a fixer-upper. Some loan programs, such as the Federal Housing Administration's (FHA) 203(k) program, allow you to roll the cost of the renovations into the mortgage. These mortgages often require more work, such as filing more paperwork or finding approved consultants to manage your renovation funds.

What types of improvements will increase my home's value?

Most renovations and upgrades translate into an increase in the value of your home (so long as they are tasteful), but some offer more bang for your buck than others. For the best return on investment, focus on functional improvements to key areas that get a lot of use, like bathrooms and kitchens. New appliances are always a value-add. If you are doing cosmetic renovations, focus on features with high visibility (flooring, garage doors, exterior paint), and avoid trends.

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The Balance uses only high-quality sources, including peer-reviewed studies, to support the facts within our articles. Read our editorial process to learn more about how we fact-check and keep our content accurate, reliable, and trustworthy.
  1. Department of Housing and Urban Development (HUD). "SFH: 203(k) Rehabilitation Mortgage Insurance."

  2. Department of Housing and Urban Development (HUD). "203(k) Rehab Mortgage Insurance."

  3. Fannie Mae. "Borrowers Now Have an Easy and Affordable Option To Finance Home Renovations."

  4. U.S. Department of Veterans Affairs. "VA Home Loan Guaranty Buyer's Guide."

  5. "The 6 Most Valuable Home Improvements."

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