Buying a house in Mckinney Texas : Affected by lightening fire

Buying & Selling Real Estate
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Buying a house in Mckinney Texas : Affected by lightening fire

Satya Patil
Sacramento, CA · Member since 2016 · 23 posts · 2 votes

Hi All,

This is my first post in this forum! I am in process of buying a single family home as an investment property in McKinney, TX. From the disclosures I understood that there was a fire in the attic caused (previous owners version) by lightening. The cost of repairs was 70k+, which included new insulation, new rafters and beams in the roof, new roofing, new heating and air units (since they are in the attic), etc.

Now I am in two minds as to whether or not pursue this home further. Rest of the house is in good conditions. Will this fire damage become a problem when I have to sell this house. 

I have 1 week option period till next Friday. I have scheduled an inspection next week.

Any feedback, help as to whether or not pursue this home any further is greatly appreciate.

Thanks,

Satya

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Naveen Desai
Real Estate Professional · San Francisco-East bay, CA · Member since 2013 · 340 posts · 50 votes
10y

Hello Satya, 

   What is your plan for the house. Are you rehabbing it and will you occupy to live-in? Or are you planning to flip it. Either way, you may want to talk to the city and make sure what all needs to be done to meet the code and all requirements to get a CO ( cert of occupancy).  May be also talking to the local fire officer may help. 

You will probably have to involve- architect, and environment verification consultation etc,.. If this is your first venture, you may want to have the appetite & holding power for it.  Else you may want to pass on.  If you do the latter- please ping me. :)

Thanks,

Naveen.

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  • Naveen Desai
    Real Estate Professional · San Francisco-East bay, CA · Member since 2013 · 340 posts · 50 votes
    10y

    Hello Satya, 

       What is your plan for the house. Are you rehabbing it and will you occupy to live-in? Or are you planning to flip it. Either way, you may want to talk to the city and make sure what all needs to be done to meet the code and all requirements to get a CO ( cert of occupancy).  May be also talking to the local fire officer may help. 

    You will probably have to involve- architect, and environment verification consultation etc,.. If this is your first venture, you may want to have the appetite & holding power for it.  Else you may want to pass on.  If you do the latter- please ping me. :)

    Thanks,

    Naveen.

    1Reply
  • Satya Patil
    OP
    Sacramento, CA · Member since 2016 · 23 posts · 2 votes
    10y

    Hi Naveen,

    Thanks! The house was fixed by the previous owner (from whom the current seller bought the house). So, I am guessing he/she would have done all the things you mentioned. So the house overall looks okay now. My plan is to buy and rent it out for a few years. Later if the market picks up I may decide to sell. My main problem is that this house may not be easy to sell due to the fire incident.

    Please let me know what you think.

    Satya

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  • Scott Beck
    Investor · Murphy, TX · Member since 2015 · 145 posts · 53 votes
    10y

    Hi @Satya Patil,

    Several suggestions:

    • I would be at the home during the inspection and ask questions of the inspector. If there are any recommendations try to get as many details as possible on the problem and how to proceed.
    • Check with your insurance company to see if there are any ramifications of the fire. Also ask if it would be worthwhile running a CLUE (Comprehensive Loss Underwriting Exchange) report on the property.
    • Check with your electrician to see if they recommend anything since the house was hit by lightning.

    Good luck.

    1Reply
  • Satya Patil
    OP
    Sacramento, CA · Member since 2016 · 23 posts · 2 votes
    10y

    Hi Scott,

    Thanks for your reply and all information in it! I will follow up with my insurance company. 

    Since, you are from Texas, I do have a follow up question. Would prospective buyers have problem buying a house that was affected with fire, especially after know that so much damage was caused to the house? Someone told me that lightening and the damage caused by it are common in Texas.

    Anyone else from Texas reading my question please feel free to comment as well.

    Thanks,

    Satya

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  • Kelcey Land
    Flipper · Colleyville, TX · Member since 2014 · 59 posts · 23 votes
    10y

    I think the reason no one answered that part of the question is because that's just something you'll need to guess at. Would you buy a house with previous storm damage? Probably. Will disclosing it discount the price? Maybe. Any buyer will have it inspected, and that's where you will live and die. I can't tell you how many times inspectors have messed up one of my deals. I had one write up no GFI plugs in the wet areas as a "critical" item. Sometimes that's all it takes to spoil a buyer, and there is no arguing with an inspection report. OK, now that I'm off my soap box... I would say for every buyer that may be turned off by previous damage, another buyer won't care. Over all it will be a negative, but you should be buying the property at a discount so it's kind of a wash. I do not think you'll be stuck with an unsellable house (if that is your concern).

    1Reply
  • Satya Patil
    OP
    Sacramento, CA · Member since 2016 · 23 posts · 2 votes
    10y

    Hi Kelcey,

    Thanks for your candid response! Yes, getting stuck in an unsaleable house is my concern. From my small experience in house hunting in Dallas-Texas areas It seems that buyers are very choosy and they may not be willing to buy a previously damaged house. In other markets which are hot this may not be a big problem.

    Thanks,

    Satya

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  • Rod HanksBusiness Member
    Insurance Agent · Dallas, TX · Member since 2013 · 743 posts · 462 votes
    10y

    @Satya Patil

    The only thing is even though it was properly rehabbed you would still have to disclose the prior fire damage when you sell, which could create a problem when you are ready to sell. To put the fire out, they used LOTS of water, so it may be mold and water damage throughout the house that cannot be seen. Also, with my main carrier (Nationwide), I would have reservations about insuring it due to these issues. I'm not saying I wouldn't but I would have reservations. If you are getting a great deal on this house I would say yes, but I'f not I would pass.

    Rod Hanks Insurance4.9155 Reviews
    WebsiteView Page
    1Reply
  • Satya Patil
    OP
    Sacramento, CA · Member since 2016 · 23 posts · 2 votes
    10y

    Hi @Rod Hanks

    You do bring up couple of important points about the mold/water damage and insurance.  I had not thought about the water damage part before.. so really appreciate you bringing it up.

    If anybody else has any other feedback please let me know. I want to make an informed decision and not a hasty one. And since this is the first time I am facing such a situation your feedback is important for me. 

    Thanks,

    Satya

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  • Scott Beck
    Investor · Murphy, TX · Member since 2015 · 145 posts · 53 votes
    10y

    Hi Satya,

    Just like it is for you, the disclosed fire will be a red flag for buyers. So some will not be interested in the property and others won't care. I don't have any hard data on this, but think it will reduce the number of buyers looking at the property.

    Scott

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