Is Termite damage a deal maker?

Question

look for some advice.

There's a house that is foreclosed below 20k  a 3/1 1200sf. I noticed the bottom sill is completely damaged by termites I'm assuming. All the way around the house. My be more damage else where. Is the risk worth making an offer? I'm looking to turn into a rental. Bringing in about 600-650 a month.

Account Closed · Answer

I would recommend getting a termite inspection and getting some quotes for the repair. As long as you aren't surprised by anything you can plan and offer accordingly.

Millie D. · Answer

I'm in North Carolina, similar climate and building techniques to Alabama (wood frame on brick/block crawlspace). I've been renovating homes for 10 years and have run into termite damage quite often. Usually it is confined to one area--one room or one side of the house, usually one that is close to the ground. When the sill is damaged to the point you described, it has to be repaired. That's an expensive process that requires tearing off the siding, bracing the walls while rebuilding the sill, scabbing or sistering the old studs onto the new sill. Then patching the torn out wall and floor area that had to be removed to get to the sill. Then new trim, new siding etc. in those areas.

Termite damage like what you're describing is really, really bad, because you're looking at having to do the repairs on ALL the walls. Lots of time, lots of money.  Also, if the sill is that bad, I would imagine the studs and siding are also compromised.  I would guess that a contractor is going to bid you $20K at least. You might be able to get away with renting it without the repairs for a little while but eventually the walls and windows will start sagging where they are falling down because the sill is gone. And forget reselling it without the repairs.

If you make an offer on this one, I would be sure to have a contingency that allows you to get a couple of contractor's quotes on the repairs before the final decision is made. Be sure to factor in the vacancy time while the work is being done.

Marian Smith · Answer

it all comes down to running the numbers.  If you have to make structural repaiprs, you have holding costs while making the repairs etc.  Your discount should  cover those costs as well as some sort of discount for the damage you can't see but is likely present.  Severe termite damage is probably not the best choice if this is your first fixer upper and sill plate is a pretty important structural element.

Zyron Reed · Answer

The house is wood frame on enclosed crawl space (brick). Built around 1960. Thanks Austin.

Zyron Reed · Answer

Thanks Andrew, Jeff, and Michael. I apologize for all of my typos. There is no noticeable structure failure. But, there is major repair needed. On the front, rear, and sides of the home you can push a stick all the way through the sill (2x10).  It is very soft.

Michael S. · Answer

Most often it is still a buy.

Is the home construction block or wood frame?

In the past I have purchased block homes with termite damage to wood trim.  This is my favorite scenario since it scares off many potential buyers but the damage is usually found only on a few pieces of wood trim and not structural.

What is the age of the home home?

In Phoenix, homes built before 1960 will often have redwood construction.  The redwood may have a few bites taken but seems to be very disagreeable with the termite palate and resistant to the termite advance.

How extensive is the damage?

If the home is wood frame construction it depends on how extensive the damage is.  A window sill can easily be replaced but it would be good to have an attic inspection to look for more damage.

In the southwest, I will have the home sprayed after purchase to halt any further damage.  In most cases, termites are not a deal killer unless the home is experiencing structural issues as a result of years of extensive termite damage.  I can't speak for your area but in the southwest, most older homes experience some amount termite damage at some time.

Sounds like you found a great investment. I hope this helps.

-Michael

Jeff Morelock · Answer

You can lock up the property but make sure you and a subject to inspection clause. Then have a professional termite inspection done. You can decide after whether to cancel the contract or adjust the purchase price.

Andrew Syrios · Answer

Sometimes termite damage is relatively minor and can just scare off other buyers (which is great). This sounds pretty significant. It doesn't mean there isn't a deal to be had there, but be careful and definitely get your inspections if you want to pursue this.