Fire Damaged Home

Buying & Selling Real Estate
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Fire Damaged Home

Ashley Guzman
Realtor · Fort Worth, TX · Member since 2015 · 69 posts · 19 votes

Hi everyone, 

Ok so I have a question about a severely fire damaged house. I have a woman who wants to sell her house to me, however, after an initial search on the internet I saw that the home had been through an awful fire. I have not been out to see the property in person but plan on going first thing in the morning to get a better look. From what I saw the damage is very extensive. Now, I am a wholesaler so obviously this would have to be that type of deal. First, can I wholesale a fire-damaged house? Are there buyers that will buy that type of damaged property? Secondly, how would I even attempt to try and figure out a repair cost..I mean basically it would be a tear down just based on the pictures I saw and that would then turn into a new construction in the end, so I have no idea.  I would really like to help this woman if I could but I understand that if its not workable then its not workable. I just enjoy helping people and finding solutions to their problems so, if any of y'all could help me out with advice that would be great! Thanks everyone and I look forward to hearing all the ideas and advice you may have.

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  • Gilbert Dominguez
    Investor · Chicago, IL · Member since 2015 · 677 posts · 309 votes
    11y

    When dealing with a fire damaged building especially if you have no experience with fire damaged buildings first picture this in your mind. Which would you rater deal with? An empty building lot or an empty building lot with 20 tons of toxic materials?

    When people see fire damaged buildings the first thing that come to mind is how cheap they should be able to buy such a property. Remember the demo will not be free even if someone offered you the property free. Could you be looking at $30K worth of demo, special permits, asbestos and lead based paint remediation. There are toxins present at almost every single fire damaged building. 

    Did the owner have insurance and has the insurance company already settled with the owner?

    Let us say for the sake of argument that the owners had no fire insurance and they are suffering a total loss of their residence. You are having communication with them so that means they must be living somewhere and obviously they are not living in the home with so much damage. 

    Proceed slowly and make plenty of notes during your due diligence. Ask potential buyers if they would be willing to consider a building with extensive fire damage before getting it under contract. 

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  • Ashley Guzman
    OP
    Realtor · Fort Worth, TX · Member since 2015 · 69 posts · 19 votes
    11y

    Thank you for the advice Gilbert. I assume the owner has no insurance as the property was damaged a few months ago and nothing has been done but I will definitely ask her. I checked the tax records and she owes some back taxes. Just based on the pictures it really does look like a total loss. I just dont want to put anything under contract until I know for sure that there is in fact a buyer who buys these types of properties. I do not want to waste anyones time, especially the owner because I feel like she has already been through enough, but I do want to help and hopefully make a profit in the mean time.

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  • Joe Bertolino
    Investor · El Dorado Hills, CA · Member since 2012 · 1k+ posts · 1k+ votes
    11y
    Just because nothing has been done doesn't mean an insurance company hasn't paid in full. She could be sitting on that cash and willing part with it for whatever she can get. Unless you have prior experience with fire damaged properties I would pass.
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  • Ashley Guzman
    OP
    Realtor · Fort Worth, TX · Member since 2015 · 69 posts · 19 votes
    11y

    That is a good point. I do not have experience with fire damaged properties but I do not plan on rehabbing it. This would just be a wholesale deal for me. I just was not even sure if there were buyers out there for this type of deal. I feel like if there is an interested buyer he/she could give me their margins and we could get a deal done. Just want to try everything I can before I pass because the way I see it, everything is a learning experience and I can not learn if I walk away too soon. :)

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  • Tori Manuel
    Investor · Gilbert, AZ · Member since 2015 · 30 posts · 13 votes
    10y

    Hello Ashley,

    I'm curious what was the end result with this seller? Did you end up working with her on this house? I'm curious because I came across a similar property and wanted to gather some insight from BP. Thanks!

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  • SHAW ALI
    Real Estate Investor · CORONA, CA · Member since 2011 · 17 posts · 0 votes
    6y

    I am in a similar boat as the owner of the fire damaged property. Would like to hear how it all ended up, particularly from the owner side. Thanks

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