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Turnkey vs. Fixer-Upper Home: Know Before You Invest
If you’re contemplating purchasing your first home or an investment property, finding a home that meets your needs can be challenging. You may be debating between buying a turnkey vs. a fixer-upper home. The biggest difference between these two is the condition of the property. Determining the right fit depends on what you are able to take on as a homeowner and what you want to achieve if you’re going to rent the home and become a landlord.
What does turnkey property mean?
Turnkey properties are move-in ready houses. This means the property doesn’t require any repairs and is ready to rent immediately. Sometimes these homes are newly constructed and other times, the homes are recently renovated. Often, renovated homes are owned and refurbished by companies that specialize in these types of transactions. The company may offer property management services as well. This is a great option if you prefer not to be involved in the day-to-day requirements of managing an investment property and being a landlord.
What does fixer-upper mean?
Fixer-uppers are the opposite of turnkey properties. Purchasing a fixer-upper means exactly what the term implies, a property that requires fixing before it’s move-in ready. If you invest financially in a fixer-upper, you must also be prepared to invest your time and additional money in making repairs and remodeling. Often, these properties require extensive renovations before renting out. While fixer-uppers have great potential, it’s up to you to make this potential a reality to ensure your investment transforms into profit.
What to know when buying a turnkey
Turnkey Positives
If you are a first-time homebuyer, a turnkey home might be the best option. This way, you don’t have to worry about major repairs in addition to going through a home purchase for the first time.
Since turnkey houses are move-in ready, you could start renting out this property immediately. Without needing to do renovations, the only necessary step is finding a renter. And typically, in today’s tight housing market, identifying a renter is relatively easy and quick compared to big home repair projects. Additionally, if you’re not interested in dealing with the work required to find quality tenants, a property management company can help. Our colleagues at Windermere Property Management are experts in marketing properties, screening potential tenants, collecting rent, and handling maintenance issues. This is a great option to generate passive income without dealing with day-to-day operational tasks.
Turnkey Negatives
While buying a turnkey home may sound like a no-brainer, the main downside is higher costs. A pristine property comes at a premium price. Top renovations such as new appliances, tiling, flooring, painting, and cabinetry all cost more, which shows in the listing price. If you decide to purchase a turnkey home, take time to figure out how to make it work financially. Research strategies to save money for a down payment while still covering your other expenses.
Turnkey properties aren’t always what they seem. According to the National Association of Realtors, “turnkey should mean that everything in the house is new, rehabbed, or otherwise in excellent condition with no visible signs of wear”. However, it can extend to “a house that is generally clean but needs substantial updating.” So, be careful when viewing homes labeled as “turnkey”, especially flipped homes. A great buyer’s agent will know what to look for and can find out what has been repaired and updated. Then you can make sure everything is thoroughly inspected for quality and safety.
What to know when buying a fixer-upper
Fixer-Upper Positives
Many buyers are looking for turnkey homes, so there is a much smaller pool of people searching for fixer-uppers. Most buyers do not want to take on a major remodeling project and invest in repairs, especially if they’re taking on a second mortgage with an investment property. The combination of less competition and extensive repairs can mean better prices. Just make sure to do your research and talk to your real estate agent before making an offer. Together, you can come up with a strategy for making the best offer. By securing a deal, your investment will increase as the home’s value increases with repairs, renovations, and improvements. Your efforts will pay off down the road with a higher return on investment potential.
Fixer-Upper Negatives
The major negative of purchasing a fixer-upper is the cost of making necessary repairs. While you won’t have to worry about the fix-it extremes depicted in the classic movie “The Money Pit”, it can still be a costly endeavor. The real cost of a fixer-upper varies depending on the location, home size, and types of repairs. If you happen to be pretty handy, you might be able to save money through DIY remodeling projects. If you’re not, hire professionals to prevent needing to hire contractors to fix your mistakes.
Despite your best efforts to budget repairs, it’s impossible to account for unforeseen incidents. To minimize unexpected repairs, ensure a thorough home inspection is completed on the property before buying. Regardless, projects may run long and over budget, supply costs might rise, and the market might change by the time the house is ready to rent. Make sure you talk to your homeowner’s insurance company in advance to understand what’s covered in these types of scenarios. You may be able to qualify for a home improvement loan to help finance the renovations, but this is still money that must be paid back. Buying a fixer-upper is a big decision that requires a lot of thought and planning.
A local real estate agent can help
One of our highly-rated Windermere Silverdale agents can help determine what’s best for you. They are experts in our local real estate market and can identify properties to view and discuss. You can also check out some of their helpful home-buying tips.
If you’re thinking of buying a home in or near Kitsap County and you’re in the military, many of our agents work with military families. Some of our agents are veterans, military spouses, and/or relocation specialists. Explore our military resources to learn more.
Whether you purchase a turnkey home or a fixer-upper, we wish you the very best in your home-buying journey.
Fourth Quarter Market Review for Kitsap County
Kitsap County’s real estate market is still going strong, and here’s a look at how we closed out 2021. Just as in previous years, our local market slowed down during the holiday season. There are still many eager home buyers wanting to live in Kitsap County, but fewer homes were for sale during the fourth quarter. Continued low inventory means that our market still favors sellers.
The Latest on Sold and Pending Homes
When viewing the last five quarters in the graph above, you can see that we had our usual growth trend in the summer. And, as we moved into colder months, we saw the seasonal slowdown. Home prices continue to rise due to high demand, and sold homes are still outpacing pending listings. The result is a strong seller’s market. In the 4th quarter of 2021, we had 1,291 closed sales, a 4.9% decrease when compared to 2020’s fourth quarter.
Our Strong Seller’s Market
With the new era of remote work and many wanting the peaceful, connected lifestyle that Kitsap offers, demand in our area remains strong. If you’re a local resident and looking to move, it’s a great time to sell. If you’re a buyer wanting to move here, learn about Kitsap County in our free digital guide. And, if you have any questions our local experts are here to help.
A Look at Listing Price vs. Sale Price
Although most buyers are still able to pay at or above the listing price for a home in Kitsap County, there just aren’t enough homes available right now. Demand is pushing the cost of housing even further in favor of sellers. In our 4th quarter, we saw an 11.3% increase year over year in the average sale price in Kitsap County, putting it at $613,000. While it is a great time for sellers, many are now voicing affordability concerns.
Insights from Our Chief Economist
Looking at the broader real estate market, we have insights from Windermere’s Chief Economist, Matthew Gardner. In his most recent Monday with Matthew, Gardner shared his market forecast for 2022: “If everything goes according to my plan, you should expect to see the housing market start to move towards some sort of balance next year, but I am afraid that it will still remain out of equilibrium until at least 2023.” This is an important reminder that the transition back to a balanced market will be a gradual shift.
While Gardner ensures us that he “doesn’t see a housing bubble forming,” he is concerned about housing affordability. There is definite cause for concern among the millennial generation as they start to settle down more and more. Millennials are currently the largest group in the generational real estate market, so it will be interesting to see where affordability and demand intersect.
In his video, Gardner concluded by saying, “demand for ownership housing remains remarkably buoyant and, in fact, it is quite likely that demand may actually increase with the work from home paradigm that will start to gain momentum next year.” In light of this, real estate continues to be an excellent investment.
New Agent Spotlight: Cameron Tappe
We’re excited to feature Cameron Tappe, a new agent who recently joined Windermere Silverdale. He grew up here in the Pacific Northwest and is energetic, hardworking, and dedicated. Learn about his background, professional approach, and more in our Q&A.
What drew you to real estate?
It is so motivating to have the opportunity to help people achieve major milestones in their lives every single day. I get to meet and engage with the people in my community and this fuels my desire to grow both personally and professionally to provide the best real estate expertise possible to my clients.
What unique skills do you possess that enhance your abilities as a realtor?
Real estate transactions have a lot of moving pieces and they have to be put together like a puzzle. I am committed to my clients and resourceful in my problem-solving. Listening and interpreting your clients’ needs is a part of the communication I provide to my client. I am a go-getter and I make things happen in my life. I achieve goals and I am beyond excited to be able to make things happen for my clients.
What personality traits do you think are important in this profession?
Growing up, I was able to watch my parents operate their own business and see the strong work ethic it takes to succeed. I have seen how to run a business with honesty and integrity. I think you have to be personable with your clients and have a good sense of humor. There are a lot of different situations we are put in every day and we have to work well under pressure and in a certain time frame. It’s very important to stay organized.
What area do you serve and what do you love about it?
My office is in Silverdale and I primarily work in the Kitsap County area. I love being in the scenic Pacific Northwest and spending time outdoors. Having easy access to great hiking trails, fun camping spots, and peaceful national parks is an amazing privilege I couldn’t live without!
How long have you lived here and what brought you here?
The Pacific Northwest has always been home. My partner and I live in Manette and enjoy the central location which allows us to conveniently access all that Kitsap County has to offer.
What made you decide to work with Windermere?
I love the long-standing relationship Windermere has with its community. I think it’s amazing Windermere has a partnership with the Seattle Seahawks to fight homelessness. Additionally, Windermere has a great mentorship program for new agents and a strong team of experienced agents willing to help out.
Is there anything else you’d like to share with us?
I am incredibly excited to start this next chapter of my life with Windermere. I would love the opportunity to assist you in your next real estate endeavor!
We are so glad Cameron has joined our Windermere Silverdale team. His communicative nature, strong work ethic, and local expertise make him a great advocate for buyers and sellers. You can learn more about him through his website and his Facebook profile.
Great Gadgets to Improve Your Home
Thanks to technology, it’s easier than ever to efficiently brew your morning coffee, keep your home secure, and wash your clothes. While there are many interesting gadgets and smart appliances, here are some of our favorites to improve your home.
Smart Washer
We all have a limited amount of time to get things done, and laundry is no exception. If you’re ever guilty of forgetting to put the wash in the dryer, or if you struggle to get stains out, a smart washer and dryer can help. These energy-efficient appliances detect the right water level, have an impeller plate to gently agitate clothes, and notify you when a cycle is complete. You can wash your clothes more efficiently and enable voice commands. Some have extra features like a stain-fighting setting, and the ability to create custom settings. And, of course, the perfect addition to the smart washer is a smart dryer.
Home Security
Home security is always a top priority. Thankfully, there are many options when it comes to smart home security systems. Many of them have motion-sensing home security cameras that allow you to monitor your home. You can also connect the system to your phone to receive a live feed of the cameras from wherever you are. Brands like Vivint, Simplisafe, Ring are reliable and offer different features. Whether you’ve lived in your home for decades or you’re a new homeowner, you may want to consider a smart system that offers voice-enabled commands, notifications, and more.
Smart Coffee Maker
A smart coffee maker will expedite your morning routine by automatically brewing a perfect cup of coffee at a set time. Additionally, some smart coffee makers can grind beans and even brew espresso on command. Smart coffee makers have become increasingly affordable and can be programmed using your smartphone.
Roku Streaming Stick
Roku brings the ease of all streaming services right to your TV without the need for an expensive smart TV. The device usually sits around $40 to $80. The Roku Streaming Stick is easy to set up and has a user-friendly interface. With a Wi-Fi connection and a TV, and you’re ready to view any movie or show from your favorite streaming services. Plus, you can even bring it on the road with you, thanks to its portable design. It is compatible with voice-enabled devices and has automatic software updates.
Soundbar
Turn your living room into a movie theater with a soundbar. This fantastic speaker packs the power of a surround sound system into a slim device that sits right under your TV. Essentially, multiple speakers combined into one provides users with an immersive experience. When paired with a smart home system, they can even understand voice commands.
Smart Garden
Enjoy fresh, homegrown basil or salad greens – even in the winter. A smart garden grows herbs, greens, tomatoes, and more by monitoring water and using LED grow lights. This indoor garden varies in size and is completely organic. It is an excellent gift for gardeners and cooks.
New Agent Spotlight: Joe Stevick
We are proud to feature Joe Stevick in our new Q&A spotlight series. Joe is one of our new real estate agents and brings a range of interesting skills and experiences to the table. He’s a lifetime local of Kitsap County who is involved in the communities he serves and he has also spent time working abroad. Read on to find out more about this caring professional who truly puts people first.
What drew you to real estate?
I was drawn to real estate because I love working in service industries and had recently returned to Kitsap County after a long stint overseas. I was also curious about the increasing costs of housing and the worsening problem of homelessness in our area.
What unique professional experiences or skills do you possess that enhance your abilities as a realtor?
I was in the Peace Corps for three years. This, coupled with working as an operations director for a small chocolate factory in Madagascar, has taught me a lot about people and the level of problem solving and patience that is required to get the job done. Peace Corps really teaches you to understand people and to help them in the best way possible.
What personality traits do you think are important in this profession?
I think patience and a knack for listening to people are important characteristics to have in any profession and real estate is no different.
Which areas do you serve and what do you love about those areas?
I serve all of Kitsap County and Mason County. I love these areas because there is a rural lifestyle that still has access to the city if need be. Also, we have an incredibly diverse group of people in these areas, which I love. Helping people integrate and better their new communities is a passion of mine.
How long have you lived here?
I grew up in Kitsap County, going to Esquire Hills Elementary, Ridgetop Junior High, and Olympic High School. COVID-19 brought me back to Kitsap but the people, lifestyle, and natural beauty of the PNW kept me here.
“My siblings and I. Where would we be without siblings?”
How are you involved in the community?
I am a member of the East Bremerton Rotary, through which I do a lot of work for the Illahee Preserve. Also, I help out at Olympic High School when I can, and still have affiliation with the Olympic High School baseball team.
What made you decide to work with Windermere?
I decided to join Windermere because I could tell right away that its affiliates were nice and welcoming. Windermere has a respected name and it is because its agents are professional and caring. This is what I wanted to be as a new agent.
We are so happy that Joe has joined us. We know his skillset, professionalism, and sincerity will be an asset to buyers and sellers across Kitsap County and Mason County. You can connect with Joe on Facebook, Instagram, or through his website.
Silverdale & Bremerton: Strong Communities, Convenience and Charm
Surrounded by Puget Sound and the Olympic Mountains, Silverdale and Bremerton boast a range of businesses and entertainment as well as a strong military presence.
From Settlers to City
On a beautiful, cloudy day, the Silverdale waterfront gleams with a silver glow. On shore, a bustling city center houses the most expansive shopping experience on the Kitsap Peninsula. There are local favorites like Purpose Boutique, Lisa Stirrett Glass Art Studio, and Silverdale Antiques. And, you can find everything you need by visiting Kitsap Mall, Trader Joe’s, and Costco. Great stops for a bite to eat include popular places like Monica’s Waterfront Bakery & Cafe, Jo:a Japanese Restaurant and Yacht Club Broiler.
While it’s a strong center for economic development today, Silverdale actually started in a modest fashion. First formed in 1920 as an unincorporated port to serve the logging industry, Silverdale transitioned to a farming town. This gave way to Scandinavian immigrants who became the first permanent settlers in Silverdale.
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- Aerial view, Port of Silverdale, 1952
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- Visitors at the old dock in Silverdale on Dyes Inlet, Kitsap County
In the decades that followed, the introduction to the ‘Bremerton-to-Poulsbo Highway’ changed Silverdale into Kitsap’s busy commercial center. Over time, Silverdale began adding amenities like the popular Silverdale Waterfront Park to honor the proud Old Town port of its early days.
Bremerton’s Beginnings
Founded by the vision of Real Estate businessman, William Bremer, and platted in 1891, Bremerton houses the largest Naval Shipyard on the West Coast. The Puget Sound Naval Shipyard survived both World Wars and was even expanded during the Great Depression.
Points of Pride
Today, Bremerton is the largest city in Kitsap County. It has a population of over 41,000. By ferry, Bremerton residents reach Seattle within an hour to enjoy the larger city life across Puget Sound. While the military defined early Bremerton and still shapes it today, business development paved the way, specifically within the arts. The now-famous Admiral Theatre has housed some of the greatest names in music and entertainment. It sets the stage for an Art Deco-inspired downtown, complete with art galleries and Historic Roxy Theatre.
And, fun fact: music legend Quincy Jones grew up in Bremerton. The city dedicated an entire square downtown to honor his legacy as the most famous hometown artist. Hysterically, Quincy recalled his Bremerton youth on The Late Show with Stephen Colbert, saying, “What happened was … we wanted to be baby gangsters and like, rule Bremerton.”
Bremerton also offers fabulous eateries like La Fermata, voted this year’s Best Romantic Dinner in Central Kitsap and Bremerton, and Silver City Brewery, bottling wonderful craft ales alongside gourmet pub food. Axe & Arrow Gastropub offers delicious options as well, and Chef Tabura was the winner of Food Network’s “The Great Food Truck Race” in 2013.
Wonderful Events and Outdoor Escapes
Silverdale and Bremerton are popular shopping and dining destinations with distinct features. Additionally, they offer a strong sense of community through many local organizations and events. Fun annual festivals include the Blackberry Festival, Armed Forces Day Parade, Wayzgoose Arts Festival, and Whaling Days.
These charming cities harbor many larger city conveniences yet they are surrounded by nature. Nestled beside the epic Olympic Mountains, Silverdale and Bremerton offer a variety of nature trails and parks to get away from it all. Here’s a starter pack of places to explore: Illahee State Park, Manchester State Park, Newberry Hill Heritage Park, Wildcat Lake County Park, and Old Mill Park. From functional to robust, Silverdale and Bremerton have blossomed into truly unique cities with offerings for all.
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- Lions Park by Leo Phillips
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- Silverdale Sunset by Leo Phillips
Why We Love Working with Military Families
We proudly support our armed forces and their families, not just today on Veterans Day, but every day. Many of our real estate agents possess a wealth of experience working with those who serve. We are well-versed in helping families who are about to PCS (Permanent Change of Station, for our non-military readers). And, we enjoy helping newcomers find their ideal home here in Kitsap County. A number of our Realtors are either veterans themselves or have family members who are.
We greatly appreciate the sacrifices that our military families make and wanted to share a bit about why we love working with them, sharing experiences from three of our local experts: Nick Blickhan, Summer Davy, and Adam Moon.
Our Military Connections
“I am a Navy Veteran from the Surface Navy, with a couple of years stationed at SUBASE Bangor,” explains Realtor Nick Blickhan. “I understand the military language and the process that they go through. As a landlord for 25 years, I preferred to rent to active duty submariners. I would even rent to groups of single guys. We made arrangements for their deployments. Some of these single sailors also became clients down the road.”
“My husband proudly served four years in the Navy and I am a lifelong resident of Kitsap County,” says Realtor Summer Davy. “So many of my friends and family served in the armed forces. The presence of the bases has always played a factor in employment and the fabric of our community here.”
“Both of my grandpas served in the military – Marine Corps and the Navy,” says Realtor Adam Moon. “My wife’s grandfather served in the Marine Corps. My best friend’s father served in the Navy and was Georgia Blues Submarine Captain. They’re all heroes!”
We Enjoy the Interesting Challenges and Stories
“Timelines are critical when you work with military families that are buying or selling,” says Davy. “We need to work within the timelines given for a PCS, their reporting date, and whether or not the whole family is moving together or separately. I am especially proud of a recent experience helping a military family find the perfect home for their large family on a tight deadline – 6 kids, one with special needs requiring her own private living space, bedroom/bath. The house we found fit their family perfectly, was within budget and closed in 30 days. The sellers were also a military family relocating to Japan. Happy families all around!”
“I represented some first-time VA buyers about five years ago. In the next two years, while living in Washington, Mr. Buyer got orders to Hawaii and didn’t want to sell as they could possibly be moving back,” explains Moon. “So, they were referred to Windermere Property Management to get a tenant. About three months ago, Mrs. Seller called me and told me they weren’t coming back to the PNW as he just got orders to NY for school. So, we prepped it for the market strategically when the tenants’ lease was up. Work orders had to get done to make it market-ready. Thankfully, we were able to list the weekend after the tenants vacated. We received multiple offers and closed within 30 days and $30K over list price. In that time frame when my sellers bought, then rented, then sold, they made over $100K in the sale of their home, all being done while they were in Hawaii and getting ready to move to NY. Seamless.”
We’re Ready to Provide Guidance and Support
Windermere equips each agent with the local and global resources needed to ensure that every military family is in excellent hands. “The local lenders I work with specialize in VA loans and programs that benefit military families,” says Davy. “I feel very comfortable answering any questions from the military families that I assist with their relocation to Kitsap. I think about the questions I would have as a wife and as a mom and can provide answers and info on communities, potential commutes, activities, and shopping that will affect the daily lives of these families.”
“In my experience with military buyers, they have come to appreciate my honesty and communication throughout the buying and selling process,” says Adam Moon.
“As a Realtor/Windermere Agent for 27 Years, I have helped many active duty and veteran clients reach their real estate goals,” says Blickhan.
Every time we get to connect with a military family, we are grateful for the opportunity and even more appreciative of their service. It often becomes second nature for these families to adapt on the go and regularly make sacrifices. We admire their commitment, dedication, and selflessness. And, whenever our expertise is needed, we are ready to assist.
Central Kitsap’s Market: Third Quarter Review and Forecast
Central Kitsap’s market had a very strong third quarter. We’ve compiled key stats below to provide a comprehensive review of our market, as well as insights and predictions from Windermere Real Estate’s Chief Economist, Matthew Gardner.
Our Strong Seller’s Market
It’s a strong seller’s market here in Central Kitsap. Inventory remains low while demand is high. In our third quarter, the median sale price was up 11.5% year-over-year at $379K. Buyers should be aware that multiple offer situations have become more common in our area.
Market Predictions
Although mortgage rates remain historically low and demand is high, our Chief Economist, Matthew Gardner, has some concerns about how this may impact real estate down the road. “We may be heading towards a period where we see houses turn over at a far slower pace as we stay in our homes for longer than ever…this could be a problem as it leads to persistently low levels of inventory for sale, which itself could lead to prices continuing to rise at above-average rates and that would further hit affordability.” As for mortgage rates, Gardner does not expect them to rise significantly any time soon. However, he says, “We should all be aware that there could be consequences to very low rates”.
Western Washington Review
Let’s zoom out a bit and look at our area. Below are highlights from The Western Washington Gardner Report provided by Windermere Real Estate’s Chief Economist, Matthew Gardner.
WESTERN WASHINGTON HOME SALES
- Total Sales: 11.6% increase from Q3/2019, and 45.9% higher than Q2/2020
- Homes for Sale: 41.7% lower than Q3/2019, but up 1.6% from Q2/2020
- Pending Sales: up 29% from Q2/2020
WESTERN WASHINGTON HOME PRICES
- Average: $611,793 (up 17.1% from Q3/2019). Low mortgage rates and limited inventory are clearly pushing prices up.
- Prices will continue to increase as long as mortgage rates and inventory levels stay low. If this continues to be the case, affordability issues will become more apparent in many markets.
DAYS ON MARKET, WESTERN WASHINGTON
- Average: 36 days (an average of 4 fewer days than in Q2/2020 and 2 fewer days than in Q3/2019)
- In Kitsap County, average days on market: 20
Conclusion
In Gardner’s Western Washington Report, he states that, although we have a strong seller’s market that is very buoyant, he’s “starting to see affordability issues increase in many areas—not just in the central Puget Sound region—and this is concerning. Perhaps the winter will act to cool the market, but something is telling me we shouldn’t count on it.”
