Investor · Katy, TX · Member since 2017 · 27 posts · 19 votes
I'm closing on my first flood house in two days. We purchased the property off-market and we got a good deal. We already have two bids (still deciding), have done the mold inspection, and the numbers work - excited to get started.
My question is - to anyone who has ever rehabbed a home that has flooded before - is there anything you learned during the process (specific to the home having flooded) that you wish you knew when/before you did your first flood deal?
First is the attic. A flooded house will pump tons of moisture into the attic. This can lead to damaged roof sheathing from mold and wet or compromised insulation that will need to be replaced. If it is gutted to the roof then insulation isn't a concern, though the roof structure should still be checked for moisture as it is often overlooked. If the sheathing is OSB, a roofing inspection should be done to make sure the roof hasn't become...crunchy from mold growing on the topside under the shingles.
Second is HVAC ducting. At a minimum, assuming it is a ducted system it will need to be cleaned and sanitized. At a maximum, the ducting may need to be replaced fully, especially if it is lined.
And make sure you have a full set of mold and moisture clearance tests in hand before proceeding. Visual isn't good enough. Moisture can hang out inside structure and not show on perfunctory surface moisture readings. And because it was moldy, You should have mold clearance tests available for the disclosure.
@Rae Hoffman my current flip in Berwyn was flooded at some point. We originally went into it thinking we would be able to salvage trim, ceilings, etc. We ended up doing a gut rehab job as it just wasn' t worth saving anything. We had to install new hard wood floors (most homes have them in this market), and when we started prep work we realized we would need to replace the entire sub floor on the 1st level!
I think as long as you are expecting to place mostly everything you should be ok. We replaced all mechanicals, framing, drywall, etc!
@John Warren - yeah, this home is down to the studs, so everything needs to be replaced.
Having never done a flooded home before, we learned something right away. Seems a lot of homeowners in this particular area (that had 4+ feet of water that took a week+ to fully recede) were unsure of whether the sheathing between the brick and the studs should be removed as many homes were mucked by untrained volunteers (like me haha - I helped muck a few in a different area in the weeks after the storm). So, a lot of people left it. Unfortunately, the sheathing that appears to be standard in these homes is almost like a drywall and should have been removed. In the home we bought, the studs, floors, etc. were clear of mold, but the sheathing that had been left was not. So, on day one we'll begin ripping that out and then remediate what's needed after. Luckily, I had a lot of wiggle room for the rehab cost based on the purchase price. But, now I am factoring extra cost into any homes we're viewing that left the sheathing.
First is the attic. A flooded house will pump tons of moisture into the attic. This can lead to damaged roof sheathing from mold and wet or compromised insulation that will need to be replaced. If it is gutted to the roof then insulation isn't a concern, though the roof structure should still be checked for moisture as it is often overlooked. If the sheathing is OSB, a roofing inspection should be done to make sure the roof hasn't become...crunchy from mold growing on the topside under the shingles.
Second is HVAC ducting. At a minimum, assuming it is a ducted system it will need to be cleaned and sanitized. At a maximum, the ducting may need to be replaced fully, especially if it is lined.
And make sure you have a full set of mold and moisture clearance tests in hand before proceeding. Visual isn't good enough. Moisture can hang out inside structure and not show on perfunctory surface moisture readings. And because it was moldy, You should have mold clearance tests available for the disclosure.
That's weird. I would have expected an OSB/plywood sheathing with plastic house-wrap or felt paper depending on the age. If the home is older and has windows that are wood/wood-core with vinyl cladding I would use this chance to change them. New construction windows are dirt cheap and all come low-e. Also, when you tear off the brick to get to the drywall-like sheathing I would go back with lapped cement siding (if restrictions permit), much cheaper
Just be sure you get a certificate passing mold visual inspections and air quality and that they also provide you with an 'Insurance Stamp' (what they called it anyway).
I'm guessing the home's elevation versus the BFE checked out in that area? I know a lot of older homes in my area that the county will not permit to renovate/reconstruct because its elevation is too low.
My biggest concern is not any of the construction/remodeling issues. Anything can be fixed. What you can't fix is where the house sits. What is it now zoned as far as flood zone? Did you get an elevation certificate? When was the last flood? How often has the area flooded?
I live in an area that has flood zones. Down by the river. I can buy houses down there all day long at really good prices and not to brag, can fix anything caused by the last flood. The problem comes when you go to sell it. Your area may be different (i am hoping), because in my area, flipping in a flood zone is trouble. Buyers know this and selling them is tough business. Flood insurance is ridiculous. Since the last flood, FEMA came in and re-zoned the area and it's not good.
Even if insurance is not the issue, our buyers don't want to deal with the idea of living in a flood zone and what can happen. Our last flood was in 2011 and buyers are STILL very cautious in those areas.
@Michael Knaus - it is a first time flooder, and only flooded as a result of them opening up the Addicks Reservoir (Houston) in Harvey. We plan to BRRRR it (and factored flood insurance and a higher than normal vacancy rate into our rental cash flow numbers). I agree flipping it right away would be hard. Our area has flooded twice badly in the last two years. This house didn't flood in the first (Tax Day) flood, but did in Harvey due to the above. Home prices rebounded fairly well from the first big flood, with prices rising in the year+ between the first one and the second one, even on the flooded homes. However, I expect those who are now two-time flooders won't see the same results.
Are you planning to replace all the wiring? If not, check with the county to see if they require it. In some flood locations, the county will require that all electrical be replaced if it was under water, even if it appears to be in good, working order.
@Rae Hoffman don't think this applies to you with a dam release home, but others should be aware that "homes located in the floodplain have additional requirements, and repairs cannot be made until first contacting the Flood Management Office at ...."
My biggest concern would've been what @Michael Knaus said about being able to sell a house that has flooded before. But if you (@Rae Hoffman) are going to keep it as a rental, then it's all good, as long as you know the implications (which you've factored in). *thumbs up*
It is a lot easier to rent a previously flooded home than sell, but over time the stigma to the resale market will always diminish so BRRRR is a good plan. Its always a gamble but the flood variable adds risk that is hard to quantify up front. I suspect you will see TAR/TREC come up some new mandatory Realtor notices for future buyers in the Addicks/Barker Dam Pool areas. That may dent sales prices for a few years. After 5-7 years no one will care. That's what happened after Allison.