Bought a Fixer-Upper? Here’s the Smart Order of Improvements To Save Cash and Headaches

Buying a fixer-upper can be a smart investment—but only if you update and upgrade the home in the right order.

Rather than tackling random renovations whenever you feel like it, it’s your job to be strategic.

Homeowners should prioritize the improvements that maximize livability, protect their budget, and increase long-term value—and then wait on the ones that will drain their time and money while leaving them stressed in the process. 

But where to begin—and how much it will cost—are important distinctions we can help you with.

Improvements that matter most for the standard of living

Once you've landed a fixer-upper, putting your focus on critical systems should be your top priority.

Think plumbing, electrical, HVAC, roofing, and structural repairs. They’re essential for safety and livability—and whether you plan to flip or stay put, the house won't be tolerable without these fixes.

“Systems improvements are the invisible expense of buying a home. It might cost $3,000 to retile a bathroom with ugly tile—but it will cost $40,000-plus to replace a foundation,” says Courtney Poulos, CEO and founder of ACME Real Estate in Los Angeles.

If you’re unsure of where to allocate your funds, Poulos recommends you pay for an inspection.

“An inspection will give you an idea of which repairs are needed ASAP. Most people forget to do sewer line, termite, and chimney inspections, even though they’re often very important and can be quickly revealed in the report,” explains Poulos.

Remember, cosmetics before systems almost always means wasted money.

“I’ve seen people paint or finish walls, then tear them back open for electrical or plumbing fixes. In older homes, opening walls often means you’re suddenly on the hook for code upgrades, too,” says Christine Sommer, founder of Liberties Homes in Philadelphia.

Which rooms should get the most attention first?

Kitchens and bathrooms should be your top priority, as these renovations improve both comfort and resale value. In fact, a recent report by the National Association of Realtors® found that a complete or even minor kitchen renovation can yield a 60% return on investment, while a bathroom renovation can provide 50%. 

And you don’t have to go crazy when improving these rooms. Even modest upgrades here, such as new hardware, countertops, and energy-efficient appliances, can result in better returns than any other rooms.

If you’re going the flip route, kitchens and bathrooms are particularly crucial as they can allow you to make the important design statements that set a property apart from the competition.

“In one of my flips, we had also renovated the roof, but it was the kitchen counters and cabinetry that sparked a bidding war,” says Jacob Naig, owner and real estate investor at Webuyhousesindesmoines in Des Moines, IA.

Additionally, don’t forget about the power of staging. It can help you create livable, well-functioning rooms that make the home more attractive—even midrenovation.

Projects that can wait

Don’t rush to tackle cosmetic upgrades like paint, wallpaper, minor landscaping, or decorative finishes. Nonessential additions, such as custom built-ins, home gyms, and media rooms, can wait as well.

Toying with the idea of a new roof or new landscaping? You might want to put it on the back burner.

“If the roof has another decade left, don’t replace it. Same with fancy landscaping—you don’t need it. A clean, well-kept yard does the job,” explains Sommer.

In many cases, a phased renovation is the way to go. Sort projects into three groups: short-term (livability and core areas), long-term (optative or aesthetic improvements), and immediate (safety and systems). Start with the immediate group and go from there.

Naig tries to balance time and budget—allowing extra money for unforeseen expenses.

"I was able to prioritize roof repairs and HVAC replacement on one flip by using a staged strategy. As rental income kicked in, I was able to stagger kitchen and bathroom remodels. Without putting a hardship on finances, the property slowly improved,” he says.

Fixer-upper improvement checklist

To recap, if you're planning on buying a fixer-upper, these are the improvements you should plan on, in order of priority:

Top priorities

• HVAC repairs or replacement
• Plumbing repairs 
• Electrical repairs
• Structural roof repairs
• Foundation repairs 
• Safety hazards, like damaged stairs and holes in walls

Secondary priorities 

• Kitchens
• Bathrooms
• Communal living spaces, such as living rooms, dining rooms, decks, and patios 
• Garage door replacements 
• Simple landscaping refresh

Projects that can wait

• Paint
• Wallpaper
• Flooring
• Lighting 
• Decor
• Major landscaping overhauls
• Additions, such as pools or extra bedrooms
• Luxury finishes like high-end appliances or heated floors