Evaluating a property

[Diante Lawrence]

When you are walking through a potential investment property what are the key things you should be looking for that will let you know that it would be a good buy or that it would be too much of a hassle and to walk away.

[Christian Brodin]

Diante,

This is for apartment buildings, but you can easily transfer this to buying a SFH too.

In addition to the points below I look for future location. (What will the area look like in 10 years?), and school district.

Here are the 6 most important things you need to check for when buying an apartment building are:

1. Foundation (water leaks, cracks, tilting, exposed areas etc.)
2. Structure (settling, pest/termite, humidity/water etc.)
3. Roof (when was it last replaced?)
4. Plumbing (Cast iron, galvanized steel, polybuthelene, copper, pex)
5. Electrical (Copper, Aluminum, breaker boxes, GFCI)
6. Heating and Air (Maintenance, cooling aide, rodents etc.)

As a Rule of thumb, if the building was built after 1965 and before 1985 chances are that the builder used some kind of “innovative” (read cheap) solution trying to save money.

This includes aluminum wiring, vinyl or T-11 siding, galvanized steel piping, Polybutylene piping, double paned windows of dubious quality etc.

Avoid these products if you can. If you cannot avoid it, make sure this is in good shape when you buy the property. It can save you TONS of headaches down the road. Also confirm with your insurance company that they cover these issues (especially electrical aluminum wiring).

PS if you live in an area with air conditioning, be careful about the rules concerning Freon.

PS if you live in an area with pests, bugs, etc. you have to take extra care that you aren’t buying an infested property.

Want to learn more about how to find a good deal, and avoid losing money?

Check out www.theapartmentinvestor.com