Dangers of buying homes built in 1900

[Venky B.]

I am looking at a home built in 1900 for buy and hold. I would like to know, what are the dangers of buying a home that was built that old. The home looks in good condition. One thing I observed is that the steps of the stairs are very small, I mean height and depth. Not sure, if there are any rental codes that this home have issues with. Thanks, Venkatesh

[Scott Johnson]

Originally posted by @Ricardo R.:

@Venkatesh B. Knob and tube... knob and tube and knob and tube... this can absolutely be deal breaker for me unless I’m am getting the property at a steep discount. Just a quick story: I just had an 1890 triplex under contract only to find active knob and tube; I scoured insurance companies to give me a quote on insurance... the scary part is that about half did actually say they would insure naturally I wanted to be extremely sure so after I would specially inquire “are you absolutely sure 100% that the carrier will insure knob and tube” ... EVERY single one of them after contacting their carriers declined coverage! Naturally I went to the current owners and asked who they use... contacted their carrier asked the same and.... you guessed it NOT covered! The owners had an empty insurance policy.

I have attempted to close on a few properties with knob and tube and all turned out pretty similar as the above... so now I certainly avoid it. The issues with it are many; 1) you NEED to make absolutely sure the carrier will insure it especially if you are planning on updating the wiring that is when most fires occur and if you are not insured that’s no bueno; 2) most insurance brokers themselves don’t know or worse issue you an insurance policy - the result is that you technically do have ‘insurance’ in that you do pay the premium but are certainly not covered if something happens because of it; 3) if the electrical has been ‘updated’ check with your township to see what electrical permits were pulled if they have no record then chances are that the electrical may look updated but there is knob and tube behind the walls.

Like I said this is an absolute deal breaker for me unless we are buying as a flip or unless we are getting the property at a steep discount ESPECIALLY if it’s a multifamily.

Agreed. If it's knob and tube, just factor in a total gut job and replacement of the electrical system. 

[Steve K.]

@Venkatesh B. I’d rather have a well-built property from 1900 that has been taken care of and updated properly (ideally while preserving the historical charm as much as possible), than a new build that was thrown together as cheaply as the builder could get away with. This is coming from a former carpenter who built several new “tract-shack” budget homes that probably won’t last 30 years, and other custom new homes that will last for centuries. It really depends, the age of a building alone tells us very little. In general if a property has been around that long it probably has “good bones”, but on the other hand it could have been a mining or factory workers home thrown together quickly and only meant to last a few years that has somehow made it the distance, by the skin of its teeth. If the roof and floors are sagging, windows and doors are all original and barely functioning, any original plumbing or wiring still in use, step cracks in the brick etc then it will be a money pit of the very worst variety. But I’ve seen brand new builds that will be money pits too. So it depends on the quality of construction and how it has been treated over the years. Follow the great advice above to bring in professionals to inspect the major systems, plumbing and electrical as well as windows, doors, roof, structural etc. unless you know what to look for yourself. Unless it’s in great shape or you’re handy enough to take on a project, you may want to pass. They call these old properties “handyman specials” for a reason. I love them personally but I’m also a handyman. If I had to call someone every time an old window needed to be reglazed, I probably wouldn’t love them nearly as much.

[Julie Gates]

I love old homes. They were built to last. You can't get 1" all wood cabinets today. I say go for it and repair as needed. I definitely see the age of the home as an advantage, not a disadvantage.

[David Tonne]

@Venkatesh B.

I’ve rehabbed 2 homes from 1860’sand a couple from around 1910. Working on another from about 1865. Most were balloon framed. Issues include bouncy floors, floors that aren’t level, asbestos tile floors, asbestos siding, rubble (stone foundations). As said before plaster walls are more similar to concrete than drywall. Issues included knob & tube flooring, lack of insulation, and more. Some of the biggest issues were caused by previous “renovations” by tradesmen or owners who cut too much out of joists to run plumbing and undectected termite damage. Some benefits of old homes is the woodwork and other features. The plaster walls seem to be more soundproof. If you can find one with newer wiring and newer plumbing, you’ll be way ahead. I had one insurance cancel due to the asbestos siding even though it was painted and in good repair. These old homes aren’t generally a quick flip if you are doing the rehab properly and following current building, electrical, and plumbing moving codes. You may wind up installing mini-split a/c systems to get around the lack of ductwork. Working on these old homes is more of a labor of love.

[John Mocker]

Venkatesh,

I would add one other item that can cause an issue getting coverage, In Ground Tanks.  Whether they are active or inactive most companies I write with do not want inground tanks.  

[David Avery]

FYI

1- how do you know if the structure is good.   Look at the roof line.  It will tell you , if it curves it has some settling or structure damage.  All homes over time will start to shrink a bit.   We do too!!!

2- Plumbing almost without exception is galvanized.  It is a pain to replace with the walls being almost like those of a prison.

3- Electrical , go to the meter and open the box.  If it is new it will have newer breakers on it.

4- Generally they have a furnace the size of a bathroom.  It is almost impossible to tear it out and remove.

5- Ten foot ceilings and original flooring.  Try and  do new construction with those added features.

6- Windows and doors can be an issue also, if the house has settled than the doors and windows will have issues.

[Heather Gatley]

I have bought two 1900 homes (one a multi-family and the other a bungalow) from wholesalers.  Both looked relatively updated(flooring, appliances)  but you should be on the lookout for 1) termites and termite damage 2) foundation issues; 3) electric systems that need to be entirely redone because wiring is not up to code, etc. 4) windows that are broken or sealed shut are often not standard size and although you can order them custom, they may take a long time to come in.   Hope this helps.  

[Heather Gatley]

What is knob and tube?  Is that the old kind of electrical wiring that is not up to code?

[Lisa Stewart]

All of the stuff already mentioned with electrical, plumbing and asbestos, but also, if it has been vacant, make sure the sewer pipe has not collapsed. That can be a nasty and costly surprise ! Scope the pipes to see if there is obstruction as it can cost thousands to dig up and replace, not to mention the cost to the landscaping.

[Nick C.]

@Heather Gatley: It was the wiring system used up until the early - mid 1900's. Which means if it's being used in a house today it's reaaaally old. It's not grounded, so couple that with the age of the system and it could be a recipe for a fire. 

[Heather Gatley]

Thank you so much!  Learning learning. 

[Janet Behm]

Duplex in downtown Salt Lake City, built in 1921.

Today we got the final inspection passed!!! 5- months and 4X our original budget...but once you start?!?!

[Joey Wharton]

I specialize in 1890's homes and have gutted 6. They are a pain in the *** - no doubt - but for me the juice is worth the squeeze. It's been my niche area. Most have foundation issues - a combination of bad drainage and deferred maintenance on the stone.That's where my opportunity lies. In my area the historic part of town is a big tourist destination and the historic neighborhoods are highly coveted. You can't build that kind of history and charm, so personally I buy houses I can save. Nothing is square, there are decades of who knows what crappy DIY patch job fixes I have to tear out. But I know going in I'm taking it down to the studs and rebuild it from the studs out. The lumber is hard old growth wood and hard as stone. I've replaced sewer lines on 3 houses. Rehab time for me is usually 4-5 months. But once I am done, they are solid as a rock and good for another 100 years. It's a labor of love.  

[Robert Frazier]

THere is a reason the IRS lets you depreciate the value of a home over the 27.5 year time frame. Over that time you would need to spend at least the same amount as the purchase price to keep it in a new-condition. So over the course of 100 years it would need to be updated including all systems 4 times. If it has less than 50 year old electrical, 70 yr old plumbing, 20 yr old HVAC and the finishes are being replaced every 25 years, you could be stepping into a gem….but that is rare. Know the age of the systems and expect to spend the purchase price in updates over 27.5 years of ownership.

[Trino Martinez]

Quote from @Lisa Stewart:

All of the stuff already mentioned with electrical, plumbing and asbestos, but also, if it has been vacant, make sure the sewer pipe has not collapsed. That can be a nasty and costly surprise ! Scope the pipes to see if there is obstruction as it can cost thousands to dig up and replace, not to mention the cost to the landscaping.

 Lisa - Do you have any experience or knowledge of plumbers that do install liners in the drain pipes from the house to the city hookup? I have a house built in the 1950's in SLC that I have snaked about every 18-24 months due to tree roots. I am looking at a solution that does not involve replacement but based on my first liner quote I may review all options as excavation is required by city code for a clean-out line. Thank you in advance. 

[Trino Martinez]

Quote from @Joey Wharton:

I specialize in 1890's homes and have gutted 6. They are a pain in the *** - no doubt - but for me the juice is worth the squeeze. It's been my niche area. Most have foundation issues - a combination of bad drainage and deferred maintenance on the stone.That's where my opportunity lies. In my area the historic part of town is a big tourist destination and the historic neighborhoods are highly coveted. You can't build that kind of history and charm, so personally I buy houses I can save. Nothing is square, there are decades of who knows what crappy DIY patch job fixes I have to tear out. But I know going in I'm taking it down to the studs and rebuild it from the studs out. The lumber is hard old growth wood and hard as stone. I've replaced sewer lines on 3 houses. Rehab time for me is usually 4-5 months. But once I am done, they are solid as a rock and good for another 100 years. It's a labor of love.  

 Hi Joey - I am curious on the sewer line replacements, were those from the house to the city sewer line? Were the replacement costs similar to liner installs in the lines to the city sewer? Thank you. 

[Eliott Elias]

Most anything could be an issue for a property that old. I would especially watch out for asbestos and lead based paint. 

[Jonathan R McLaughlin]

The neighborhood where I live is mostly 1870s to 1920s with a variety of housing types and qualities.  The rich owners of the old breweries (50 some) , the well paid managers and the scraping by workers all lived in the area and different types of housing were built for them--from cheap to "wow". In the condo conversion boom much of this was updated but much was not.

But the contractors, realtors, investors and even end-user buyers are all pretty familiar with the requirements and quirks and know how to deal with them and cost out solutions. So if you are in an area where it is the norm rather than a neglected old section you should be able to deal fairly well. Just account for it. Lots of discounts available for upgrading old properties environmentally too. And these properties are in a highly valued location and sought after as a cost effective/aesthetically pleasing alternative to the new luxury housing being built. YMMV

And yea, electrical is a biggie. And don't forget the quoted costs usually don't include the cosmetic repairs after the fact.