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Updated about 5 years ago on . Most recent reply
Flips that need major foundation and structural repairs. Cons?
So far, the few flips that I've done have been what I'd call sugarcoat: paint, carpet, minor updates/upgrades, appliances.
I'm looking at a house now, however, that will need some serious work done to the foundation. Probably half of my $80,000 renovation budget will be allocated to these structural repairs.
Naturally, this will all have to be disclosed to any potential retail buyer.
Assume that, when finished, the house is perfectly renovated by any standard. Will the fact that it needed all of these structural repairs (which would be fully warranted to the new owner by the contractor) be a problem for potential buyers?
I would price the house very aggressively to sell it quickly. It would be a steal for the buyer.
What say you, BP Nation?
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My general rule of thumb on major foundation work:
If the work is visibly obvious to the buyer, it will impact your ability to sell at market price. If the work is not visibly obvious to the buyer, it shouldn't have a big impact on your ability to sell at market price.
Here is one example of foundation work (that I did on a property):
http://www.123flip.com/house-4-rehab-offer (scroll down for pics)
The fact that we didn't finish that basement with sheetrock made it a bit more difficult to sell -- we had a couple buyers who would see the plates and get very concerned.
We did something similar in a house where we finished the basement, and the buyers didn't even flinch when they read the seller's disclosure (it was clearly disclosed, but we didn't make a big deal of it).
What type of work are you planning to do?