Concerns about rehabbing a flood damaged house?

[Greg S.]

Hello everyone. I am a beginning real estate investor from NJ and am currently mailing to probates and out of state owners. The area I live in was pretty heavily hit by Hurricane Sandy. I'm about 5 miles from Seaside, where the roller coaster still juts from the ocean (if you've seen it on the news).

Many of the houses I'm receiving calls on have flood damage. I have an appointment to see a house this Wednesday. It is an inherited house, currently vacant, and had about a foot of water in it during the storm. The owner is starting to feel motivation, since they do not plan on making any repairs, and know they will have to take a cash price for the home.

I plan on taking pictures and/or video of the home on Wednesday, so hopefully I can get some assistance with estimating the repair costs. If it is a deal that I plan on pursuing, I will bring in multiple general contractors to give me quotes on the work. I also am going to give my realtor a call so she can provide me with some comps .

To be proactive, I wanted to get everyone's insight as to what I should be aware of with flood damaged homes. Is there anything in particular I should look for as I'm inspecting the property? Also, I assume this property will require flood insurance, which from what I've read is pretty expensive. In your experience, how will this affect my ability to sell the property?

Thanks in advance for all of your help.

[Bill Gulley]

J. Scott did it, I would not. Depends too on how long it was flooded and with fresh or salt water, that makes a difference.

Check the subfloor carefully, glue in the plywood isn't that water proof in exterior ply, much less interior ply. Joints will seperate, nails will "pop" and loosen giving you a squeaky floor. Even in untreated lumber, like joists, you may get twisting and lose structural integrity.

Electrical connections don't like water, especially salt water, that includes low voltage circuits as well, HVAC controll, security wiring, door bell, cable and phone.....all wiring. Salt water and humidity play on sheetrock, even the ceilings if water stands for some time.

Hollow core doors can hold water and retain moisture, get rid of them.

These issues were found with flooding along the White River in Branson and the Mississippi floods, fresh water, but also contaimnated water.

You have no idea what chemicals were in such flooded waters, how they will effect materials even if they appear clean since wood can absorb chemicals and dry out, like petrolium products.

While some of this may not be a problem for the seller, it can increase liability issues especially if not disclosed. You don't know what you don't know or what you may have missed. If water was standing for weeks, I might buy the lot and factor in debris removal from the foundation up.

So, yes, I'd say you would have some marketing issues, your buyers could have some lending issues as well. For that reason I'd probably pass. Just me.....

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