Tips for Buying an Old Home: What You Need to Know

There’s nothing like living in an older home. Packed with personality, old-world craftsmanship, and distinctive architectural features, these properties have stories to tell – and, for prospective buyers, that’s a big part of an older home’s charm. But purchasing a home that is 75 or 100 years old or older also comes with unique challenges.

So, if you’re drawn to the history and beauty of older homes, go into the buying process with eyes wide open, starting with these considerations:

 

#1. Hire a Specialist for Inspection

If you’re purchasing an older home, it’s essential to have a thorough home inspection. A true pro will be familiar with common issues in historic homes, from older wiring and plumbing to potential structural concerns.

“I always recommend working with someone who’s inspected old, historical homes,” says Chuck Ryan, owner of Northbrook-based Real Inspection Services, which services the city and greater Chicagoland area. “We’ve inspected 150-year-old homes and, recently, one that was almost 200 years old and had the original stone foundation. Having experience and knowing what to look for in different homes is important.”

After inspecting the property, an expert will provide a detailed report on the house’s condition and advise on potential repairs so you know exactly what’s needed and what could be on the horizon. At the same time, remember that surprises are almost guaranteed, whether hidden architectural gems or unforeseen repair needs. If possible, have a contingency budget and a flexible mindset as you close and move in.

#2. Understand Maintenance Requirements

While it goes without saying, old homes often require more maintenance (and higher maintenance costs) than newer ones. Expect to spend about 0.8% of your home’s value on annual maintenance costs if you move into a pre-1960s property. Opt for a home built in the 2010s and your annual maintenance cost will be about 0.2% of the home value.

Landscaping can also add to ongoing maintenance costs. Older homes often come with mature landscaping that can be rewarding and challenging. For example, large, old trees might need professional care, and garden areas may require revitalization.

During your home inspection, additional considerations may emerge. Don’t be afraid to ask for clarification if you need it – or to ask your home inspector or real estate agent for recommendations. As local experts, they have significant experience working with area contractors, electricians, plumbers, and other specialists should you want to discuss maintenance needs in more detail.

#3. Look for Structural Integrity

Older homes may have natural foundational or structural issues from outdated construction methods or simple settling over time – all details that should pop up during your inspection.

“Very rarely do we come across a structural issue with a home – but if we do, we let the prospective buyers know that immediately,” Ryan says. “We’ll let them know the severity of the structural issue and, ideally, that this particular condition can be repaired – and your next step is to find a contractor who can repair this.”

Electrical and plumbing are other considerations that can impact renovations and even insurance premiums.

“Older homes can carry a surcharge of 5%-10% of the annual premium depending on the age of the home and its systems,” says Ann Nolan, agent-owner of Ann M. Nolan Insurance Agency, a State Farm agency. “Insurers pay close attention to the mechanical, electrical, and plumbing systems.”

According to Nolan, many insurers require homes to be upgraded to 200 AMP electrical service before they will write a policy. During your inspection, ensure you get insights on the existing electrical and what, if anything, it will take to tackle any upgrades.

#4. Be Aware of Hazardous Materials

Materials now known to be hazardous, like lead paint and asbestos, were used in some homes built before the 1970s. In 1998, Illinois passed the Residential Real Property Disclosure Act to add transparency to real estate transactions. This act requires sellers to provide buyers with a reliable representation of the property – specifically major conditions, including hazardous materials.

Even with these measures in place, it’s important to thoroughly check for these materials as part of your home inspection – and, if asbestos or lead paint is present, to find out what risks exist and what the abatement process could look like.

#5. Update Insulation and HVAC Systems

Many older homes are not well-insulated and may have outdated heating and cooling systems. Consider the costs of updating these systems for energy efficiency and comfort. Central air, for example, is a common add-on to older homes. To integrate a central air system, though, a home needs to have the right ductwork – if your home needs ductwork replaced or installed, it will increase the overall cost of the new system by about one-third, according to some estimates.

#6. Consider the Renovation Costs

Remember that renovating an old home can be more expensive than a newer home, especially if you plan to restore original features. Before finalizing a purchase contract, get a professional estimate of renovation costs. If those costs come back much higher than anticipated, you may want to try renegotiating the purchase price or other terms. Consult with your agent.

Renovations can also carry unexpected “soft costs” like permitting fees or other charges for bringing a home up to code. For example, home inspector Chuck Ryan says, “People are often caught off-guard when they buy an older house in Chicago and decide to add an extra bathroom. The city might make them update their water service, which can add $15,000 or even $20,000 or more to the project cost – and people don’t always budget for that.”

#7. Check for Historical Designation

Another thing that can also impact renovation costs and timelines? Historical designations. Some older homes may be landmarked or have other historical designations that can restrict changes to the exterior and, possibly, the interior. Make sure you understand these restrictions and are comfortable with them before buying.

“Let’s say you want to replace the siding. If the Preservation Society says it’s got to be wood siding, for example, it’s got to be wood siding,” Ryan says. “You can’t go with a Hardie Board siding. You can’t go with brick. If there are double-hung windows you can’t swap for casement windows. You have to preserve the outside of the home to ensure it keeps that status.”

#8. Look into Tax Incentives

Some states and municipalities offer tax incentives for preserving and restoring historic properties. Investigate whether such incentives are available in your area and whether you qualify. The City of Chicago, for example, offers several economic incentives for rehabbing and repairing older buildings.

#9. Embrace the Home’s History

One of the joys of owning an old home is embracing its history. Take the time to research the house’s past and consider ways to preserve its unique character while making it suitable for modern living. Older homes often have unique layouts that might not align with the more contemporary homes you’re touring. Be open to non-traditional room uses or potential changes to make the space work for you.

Most importantly, remember to enjoy making an old house your home. Restoring and living in an older home can be a labor of love that, when done right, offers incomparable satisfaction and a unique sense of place.