The idea of the fixer upper home is romanticized on HGTV. Words like shiplap and demolition come to mind with a sense of finding great value. It's a wonderful idea. For the right person or family. But any time you're looking at purchasing and insuring an older home, there are some considerations that have to acknowledged for Ft Worth Home Insurance. Not the least of which is the cost of insurance. We discussed why new construction home insurance is cheap previously, so what makes older homes so expensive? Let's take a look at some key factors to consider that will potentially eat up your cash flow.
Number One: The older a home is, the more stuff that is aged and can break to cause a claim. So item number on the new build was everything is new. Here is the opposite. How long has that toilet been in the bathroom? Is the water heater older than my car? The roof from the Clinton Administration? All of that stuff is due to break. It's not a matter of if, but of when. You know it and the homeowners insurance companies know it. That's part of why your premium is higher!
Number Two: In days gone by, we thought the building methods of the day were outstanding. Some of them were, and some of them were not! Here's a quick list of items that can make your home somewhat impossible to insure.
- Aluminum Wiring
- Knob and Tube Wiring
- Fuses Rather Than Circuit Breakers
- Galvanized Pipes
- Open Foundations
- 40 Year Old Roofs
If you're buying a home with any of these issues in Texas, you will likely run into problems insuring it to replacement cost. That means that your bank may disqualify you for a loan. Knowing these things going in to the purchase process can help you determine if you can tackle that renovation or if you need to find a different house.
Number Three: The last key to insuring an older home is going to center around the roof. This can make or break most home insurance policies. Especially in North Texas. The hail claims will make this impossible if the roof is outdated. You will be moved to an actual cash value claim settlement which can cost you thousands of dollars out of pocket. Getting a new roof out of the seller can cut your premium drastically while also making sure that you put your insurance in a much better position.
Are you looking at buying a fixer upper? Give Insurance For Texans a call to discuss the options and ramifications of that house you're considering. As an Independent Insurance Agent, we have many options to take care of you. Allow our agents to help you asses the purchase and the best way to proceed.