All Forum Posts by: Parul S.

@Darren Sager

Its interesting you mention knob and tube wiring because I asked the inspector specifically about that - and his response was that if you asked 10 electricians, 5 would replace it, and 5 would leave it but if it was working fine.

It sounds like you're saying if you were buying a house with knob and tube wiring, you would always replace it?

@Rick Baggenstoss

You make some very good points. The TK didn't disclose any specific rehab apart of verbal assurances that they are "fully rehabbed".

I guess what I'm trying to understand is whether this is an unusual inspection report on a TK purchase or are they all doing cosmetic rehabs, and then fixing items based purely on what an inspection reveals?

Something just doesn't sit right with me.

@Michael Seeker - thanks for the detailed response and I like your idea of going directly to the MLS without the TK - I'm beginning to cool off TK in general!

@Mark Ferguson

I'm really flummoxed on this one. On the one hand, the inspection report shows its clearly a cosmetic rehab (and I confirmed this by speaking to the inspector). On the other hand, I've been told by TK investors that nobody buys based on the first inspection report and the seller "really value the inspectors coming in and pointing out anything that needs tweaking, redoing, etc." So what happens if a buyer (such as an all-cash overseas buyer) trusts the seller when they say they are fully rehabbed and skips the inspection?

I have agreed to buy my first SFH investment property from a TK (turnkey) and just received the inspection report. The SFH is 60 years old but was represented as being "fully rehabbed". The inspection report is concerning on the items it raises as well as the overall quality of work.

I have a few questions to consider on my next steps:

1) How to proceed on this property – if I ask the seller to fix the items, how do I trust the quality of work, given the overall quality of the “fully rehabbed” house?

2) If I proceed on this property – do I trust the seller to also be the property manager (as is currently the plan)?

3) I was planning to purchase another SFH from this TK – do I go ahead with that, given the shoddy quality of this rehab?

4) Do I just walk away from the seller altogether and consider myself lucky to have dodged a bullet (s)?

Any thoughts or comments would be appreciated - thank-you!

Key items from Inspection report pasted below:

MAJOR CONCERNS

- Major Concern, Repair: The installation of the window on the 2nd floor at the rear wall is low quality. Further evaluation is recommended for repair/replacement options. Hidden damage may exist.

- Major Concern: Inspection of the electrical system revealed the need for numerous repairs. These should be high priority for safety reasons. Unsafe electrical conditions represent a shock hazard. A licensed electrician should be consulted for further evaluation and to undertake the repairs recommended.

- Major Concern, Safety Issue: It is recommended that the obsolete and poor-condition knob-and-tube wiring in the basement be replaced. Further evaluation of the older wiring system is recommended prior to settlement.

SAFETY ISSUES

- Safety Issue: The masonry chimney should be cleaned to help assure safe, effective operation.

- Safety Issue: It is suspected that the batteries in the smoke detectors are defunct. This should be investigated.

- Safety Issue: The installation of 10 year smoke detectors inside and outside sleeping areas is recommended with none removable Lithium batteries, along with CO2 detectors within 15 feet of a sleeping area. This is recommended by the city of Philadelphia. See city codes and regulations.

- Safety Issue: There is insufficient clearance between the baseboard heater and stored items and furniture. This is a fire hazard. These conditions should be corrected.

- Safety Issue: The discharge piping serving the Temperature and Pressure Relief (TPR) Valve for the water heater should terminate not less than 6 inches or more than 24 inches above the floor.

- Safety Issue: The openings in the in the basement stairway railing are large enough to allow a child to fall through. It is recommended that this condition be altered for improved safety.

REPAIR ITEMS

- Repair: Some of the stone work mortar at the foundation wall was removed for the water piping. Proper preparation and pointing is recommended to avoid further deterioration and possible water penetration. Repairs are recommended by a qualified individual.

- Repair: More extensive than common wall cracks were observed at the rear of the house. Further evaluation and repairs are recommended to prevent additional damage.

- Repair: The flashing on the bump out should be properly sealed to avoid leaks. Further evaluation and repairs are recommended by a qualified individual.

- Repair: The masonry chimney crown is cracking. Recommend repair to prevent additional damage. Repairs are recommended by a qualified individual. Additionally a chimney cap is recommended. It is recommended that the entire flue be inspected by a qualified individual at this time.

- Repair, Monitor: The gutters on the front porch do not appear to have sufficient slope to drain properly. If they do not perform as intended, the slope should be adjusted to avoid spilling roof runoff around the building – a potential source of water entry or water damage. Debris should be removed from the roof surface to prevent premature wear and proper drainage.

- Repair: Pointing of deteriorated mortar between the bricks of the exterior walls is advisable throughout to prevent further deterioration (front and rear).

- Repair: Damaged brickwork at the rear wall should be repaired to preserve the wall.

- Repair: The loose siding at the front porch roof line should be re-secured to avoid wind-damage and varmint/pest entry and moisture intrusion...

(followed by 2 more pages of Repair Items)

@J. Martin - any update on the dates for this exciting event? I'd love to block it off on my calendar and I imagine there are other people out there like me :)

In like Flynn!

@J. Martin - does NYC qualify as the furtherest investor? Keep me posted on dates and cost. Looking forward to it.

Wow. This is why I love BP. Thank-you SO much for all your responses. I'm leaving in a few minutes for my house visit, and I feel so much better prepared than I was a day ago.

THANK-YOU!

@Cal C. - thank you so much for the tips - they make a lot of sense!

Dear BP community - my question is simple (and hopefully not a dumb one). When one visits an unfamiliar neighborhood, what are some things to look out for, either good or bad? I'm specifically asking about the neighboorhood/street/area, not the actual house.

I have narrowed some houses in a neighborhood that is a few hours from me, and I will be visiting the houses tomorrow. I have already checked out the crime stats, school ratings and "driven" around on Google maps to prep ahead of this visit. But I imagine there are certain things/signs that experienced RE investors look for, especially in an unfamiliar neighborhood/area.

Any tips or guidance would be greatly appreciated. Thank-you in advance!

@Eric Howell - wondering how your experience with Elden Properties was? Did you go ahead with investing with them?

All the best