Buying a Fixer-Upper? Watch Out for These 4 Deal Breakers!

Buying a fixer-upper can be a goldmine for real estate investors—or a money pit. We’ve seen countless rehabbers and flippers turn properties into profits, but the key is spotting trouble before you sign. Here are 4 Red Flags to watch out for, with actionable steps to protect your investment:

1. Foundation Nightmares
Cracks wider than ¼ inch or uneven floors could signal serious structural issues. According to the National Association of Home Builders, foundation repairs can cost $10,000-$30,000+ depending on severity.

Action Step: Hire a structural engineer for a $500-$1,500 inspection before committing—cheaper than a post-purchase surprise.

2. Hidden Water Damage
Musty smells, warped walls, or stained ceilings hint at leaks or flooding. The Insurance Information Institute reports water damage claims average $11,000.

Action Step: Check the basement and crawl spaces with a flashlight, and ask for flood history or past insurance claims.

3. Outdated Electrical Systems
Knob-and-tube wiring or overloaded panels scream fire hazard and costly upgrades—think $8,000-$15,000 to rewire a home (per HomeAdvisor).

Action Step: Bring an electrician to assess; if it’s pre-1960s wiring, budget accordingly or walk away.

4. Zoning or Permit Traps
Unpermitted additions or funky zoning can derail your rehab plans. A 2022 survey by the National Association of Realtors found 15% of investors faced permit issues post-purchase.

Action Step: Pull property records at the county office or online portal to verify permits and zoning before you bid.

Takeaway
A fixer-upper’s charm can hide expensive headaches. Arm yourself with inspections, research, and hard numbers to flip smart—not flop. Need funding to seal the deal? Longhorn Funding’s got your back.