Rehab and Flip Fire Damaged Properties - Deal or disaster?

[Guillermo Kennedy]

Hi BP Community!

Certain markets in the northeast have become saturated with investors with the larger, better financed ones snatching up the best deals through inside contacts and greater access to capital. I am always looking for the "road less traveled" which in my view tends to be more difficult but provides more opportunity since there tends to be less competitors. I notice that many investors (and even some contractors) skirt or totally avoid fire damaged properties. I wanted to get the BP community's thoughts on investing in fire damaged properties. Are these "diamonds in the rough" that have the potential to turn sizeable short term(rehab and flip)/long term (buy and hold) profits OR money pits waiting to suck the financial life out of all those who dare enter? Would appreciate any input on this as I saw a few fire damaged multi family properties that were selling at a deep discount (~37% of ARV) which piqued my interest. Thanks!