5 Questions to Ask If You’re Buying a Flipped House: Some extra due diligence will save you some headaches
Buying a house for a great price, fixing it up, and then reselling it sounds pretty exciting, which is why there are so many shows on HGTV about doing just that. In Miami, there is certainly a cottage industry of people that dedicate their time and money to flipping homes.
If you’re thinking of buying a flipped house, you may need to do a little extra homework before making an offer.
Before you buy a flipped house, be sure to ask these questions to make sure its in great shape and that all repairs were done professionally.
- Who’s Selling?
Whenever a home is selling for $100,000 (or more) over its previous sale less than a year ago, you need to be careful. There are many people that do this and do a fantastic job, but there are some that won’t do it by the book and won’t get the proper permits. This can kill a deal pretty quickly if you’re planning on getting a mortgage.
It can also create problems down the road. We always check to see if the property is owned by an individual or an LLC. Sometimes people form an LLC to buy a foreclosed home, renovate it, and sell it, and then dissolve the LLC. In a few years, if an issue arises and they did something faulty, you might not have any recourse.
- What Was Renovated/Repaired?
Knowing if walls were moved or the basic structure has been altered in any way is important. Find out what was renovated and repaired. Was plumbing or electrical work done? Has the roof been replaced? Major renovations can create costly repairs if they weren’t done correctly.
- Were Permits Issued?
Depending on the city, things from exterior paint to window choices require permits. Too often, this step is skipped.
Make sure the repairs were done by the book, or you may be opening yourself up for fines from the city down the road or county, roadblocks when you’re ready to sell, and headaches with your insurance company if you ever need to file a claim.
- Was the House Vacant Long?
Knowing how long the house was vacant can signal problems that you might encounter down the road. Leaks or other issues can occur when no one is checking on the property for a while, and could have just been covered up (and not repaired) during the remodel.
Let Drew Kern Real Estate help with your house hunt. Give us a call at 305-329-7744 and come meet us.
