Foundation Problems - Need some advice!

[Yuri Woitscheck]

Hi BP Community,

Need a little guidance from folks that are savvy in Rehabbing.  After getting 15 offers to buy investment properties rejected I decided to take massive action and I took a chance buying my first property off market in Tampa Bay area from a wholesaler, the numbers worked, I got local confirmation about the neighborhood, verification on rents, and the property was positioned as light cosmetics.  The wholersaler needed to turn the property around in a short amount of time so it was cash close AS-IS which is how I felt a lot of the real estate market has been like.

Now that we own the property there are several things that have popped up after I had it inspected that need repair or replacement but definitely doable.  

The major concern which we got smashed over head with and ultimately what my question is about is the foundation.  The floor is wavy with dips and a little hollow in places, there is no crawl space which would indicate the house has sunk over time and there is wood rot under all the floors.  I have had several foundation repairs companies check it out to get estimates and only 1 has bid so far and the job is $20,000 for Kitchen and Bath lift/stabilize and another $30,000 if I would like to get the whole house done.

This is not my area of expertise and the first time I had to deal with any kind of foundation issues in my life.. any advice on how to proceed would be GREATLY appreciated as an additional $20k or $50k for that matter was not budgeted for.

I have several friends in construction that think it won't be a liability for tenants but if I'm going to do the other rehab work I hate to do it on a bad base.  I could potentially go into flooring and brace old jousts to stabilize the floor a bit but again I would be learning on the fly here.

Again, any advice on how to proceed on this topic would be appreciated

Thanks Yuri 

[Andrew Postell]

@Yuri Woitscheck very sorry that your property has foundation issues but it certainly is not a deal killer.  We have foundation issues pretty regularly here in North Texas so maybe I can help in some way.

1. Structural Engineer's Report - this is a good report to have.  This will show you what areas have "sunk" and by how much.  Generally speaking if the foundation/floor is 1 inch or more in deviation then the foundation needs to be repaired in that area.  Some foundation companies can provide this in a less official manor but as long as you have the map then you can see what needs to be done (example picture attached) 
2. Water Flow - usually the foundation has shifted because moisture is not being properly regulated.  So either something needs to be address in the yard or house.  Try to see if you can visit this property when it rains (it's Florida so it will rain every day around 3pm) to see what might need to be addressed.  Maybe the foundation company has already seen something?  French Drains are a common solution to many Florida properties.
3. Gutters - this might sound a bit strange but all of my rental properties have gutters.  ALL.  Because the tenant isn't going to watch the waterflow of the property and identify problem areas.  They just aren't.  So I get gutters.  
4. Warranty - make sure that your foundation company is providing a warranty for their work.  And not one of these 90 day warranties - it needs to be a lifetime warranty.  That way if the property shifts again, it's on them.
5. Backfilling - if the foundation company is replacing a bunch of piers (or adding) that means that they are digging.  If they are digging then they need to backfill the areas.  Make sure you are having them pack that dirt in that backfill area....or else the dirt will settle, creating a lower area around the foundation....which means water will pool there and create the problem all over again.  I even go behind every foundation company with a packing tool and pack every single area.  This is going to be critical to do on the property after their work is complete.

I hope this helps in some way. Thanks!