Inspection report red flags

[Kevin Hoff]

Hi everyone,

First time home investor here. I have a single family home 3 br, 2 ba home that I've been looking at in the Kansas City Metro area that is a good value, solid ROI, great neighborhood, and good cashflow. On paper it appears to be a great deal. I received the inspection report and am unsure how to interpret everything in the inspection. Some things that caught my attention are:

1) Half of the roof was replaced two years ago, the other was replaced 7.5 years ago

2) House will need a new furnace

3) Suspected that a column has settled in the crawl space. They advise a professional engineer inspects the crawl space. 

4) Some minor electrical fixes such as new outlets and removal of abandoned wiring

5) Handrail should be added to a staircase

6) Water heater repair

7) Small evidence of termite damage, though no current termites found in the home.

8) New toilets

9) New paint

This report is making me want to not do this deal. However, I have heard that inspection reports are very thorough and appear discouraging to a new buyer (me). Feedback is appreciated! Should I run away? 

Thanks!

[David Barnett]

None of these items scare me.  The one item that is the most concerning in my mind is the termites, especially if the damage is more substantial than originally found in the inspection.  The other stuff looks pretty easy to fix or address.  I'm assuming you are working with a realtor or have a property management company lined up?  Either one of them should be able to introduce you to a GC in the area.  They should be able to take a look at the report and provide an estimate on how much the items found in the report cost to address.  If it's more substantial than you originally thought, why not approach the seller and try to renegotiate?  Options are, renegotiate, accept the report and address the items after closing, or walk away.