Investing in a historic home can be personally and financially rewarding. They’re often good value for the money. But they also come with their drawbacks. Read on to find out more about the pros and cons of buying old houses for sale.
Historic homes have a quality you won’t find in any other homes. They give their residents and visitors a trip into history and let you experience a time that’s disappeared. If you’re lucky, you could find a home unlike any other, one with an odd layout or grand staircases creating a unique charm that’s hard to replicate in modern homes.
But historic homes also have some drawbacks, including legal restrictions that vary from locality to locality. If you’re in the market for old houses for sale, here are the top five things you need to know when buying a historic home.
1. They Have Stunning Style and Architecture
Historic homes have features you won’t find today – from ornate fireplaces to laundry chutes. Some homes even have stained glass windows.
And more often than not the craftsmanship and beauty are unrivaled, even by today’s standards. In fact, one of the main appeals of buying an old house for sale is often the woodworking and other fine details throughout the home.
It’s also difficult to beat some of the architectural styles you might find, including Georgian Colonial, Art Deco, Mid-Century Modern and much more. All of these have a flavor all their own making living in the home an unparalleled experience.
2. They’re a Part of History
In the U.S., an official historic home must be categorized as a historic place and then monitored by the National Park Service. The homes must usually be at least 50 years old and meet other criteria.
These include the property’s links to a significant event. There must also be a connection to a key historical figure. The structure must also be stylistically important and provide historical information that is of significance.
Even old homes that are not officially designated as heritage properties have stories that take you back in time. By purchasing an older or historic home you are helping to keep the heritage of a community alive.
3. Historic Preservation Easements are Legal Contracts
If you choose to buy a historic home, it’s important to understand that preservation easement agreements are binding.
The U.S. government defines a historic preservation easement as a voluntary legal agreement. It notes that it is typically in the form of a deed that "protects a significant historic property."
It is a perpetual easement, meaning that the owner is assured that the property’s historic character will be preserved. You will have to pay for the easement, but there are federal tax deductions to help offset some of the cost.
4. They Offer Financial Benefits
Investing in historic properties can be lucrative because older homes are usually in historic districts that tend to show property value increases that are significantly higher than the rest of the market.
There is also financial help for repairs and maintenance of historic homes from state and local governments. They have varied tax incentives, grants, and lower interest loans that help homeowners or those considering buying a historic property. Wisconsin is just one example where homeowners can get a 20% tax credit to help maintain and fix their historic homes.
The Department of Housing and Urban Development also offers a 203k loan to help in the purchase or rehabilitation cost of a historic home. There are also Fannie Mae mortgages available for similar purposes.
5. They May Have Additional (Hidden) Costs
While there are certainly some financial and personal benefits to buying a historic home, there are also some drawbacks.
For one thing, historic homes require a lot of upkeep – in terms of time or money. Homes may have water damage, electrical issues, or even the problem of asbestos. And older homes are more susceptible to bugs like termites.
There may also be strict rules about what you can and cannot do to the home. Any modifications may need to adhere to local, state, or federal requirements.
And then there is the issue of insuring your property. Insurance companies may be reluctant to create a policy for a historic home. This is due to the fact that they may require extensive upkeep costs.
Thinking of Buying a historic home?
There are a lot of advantages to buying and living in a historic home. They offer a quality of daily life different from modern homes. But there are also many pitfalls and legal requirements that potential buyers can run into.
That’s why it’s always best to talk to a Clever Partner Agent when considering purchasing any property, but especially one that’s a historic home. A trustworthy agent will help you manage any pitfalls along the way.