Buying Property? 7 Things to Look for When Doing a Final Walk-Through

Buying Property? 7 Things to Look for When Doing a Final Walk-Through

2 min read
Marcus Maloney

Marcus Maloney is a value investor and portfolio holder of residential and commercial units. Marcus has been named the “Equity King” for his impressive ability to find real estate opportunities with massive amounts of equity.

Experience
Marcus, a high school dropout, went from G.E.D. to M.B.A. Although his education has a major impact on his investment philosophy, the real impact came from his upbringing.

Marcus thrives on completing successful transactions. As a young kid, his parents and grandparents faced many challenges; as a result, it made him think of ways he could help. His mother and grandmother were avid investors—not in the market but in people. Marcus was a recipient of those investments. And his early years were hard work growing up on a farm.

Marcus was a strategist at an early age. To relieve the burden of his family buying him clothes when it was time to return to school, he decided to make a small investment that paid big dividends. Marcus decided to purchase a small piglet at the beginning of summer, feed it until it became fat, and then sell it to a local farmers’ auction before the school year started. This was one of his first transactions and the beginning of his adventure of finding equity in every opportunity.

Marcus’ hard work continues today: He has completed over $3.3 million in wholesale transactions. Currently, Marcus is a licensed agent who wholesales virtually in multiple states while building his investment portfolio. Although wholesaling provides great money, he saw the opportunity to buy some of the deals he found and convert them into cash flowing rentals.

Marcus currently holds seven rentals, two of which are commercial units. He’s also done the unimaginable and purchased a school, which was converted to a daycare center. Again, he turns what is a marginal profit into a significant equity position. He leverages the equity by using the BRRRR (Buy, Rehab, Rent, Refinance, Repeat) strategy to increase his portfolio without any money out of pocket.

Marcus has been featured on numerous podcasts, such as the Louisville Gal Podcast, the Best Real Estate Investing Advice Ever podcast, FlippingJunkie, and many others. He’s currently a featured blogger for BiggerPockets, the largest community of real estate investors in the world.

Along with completing transactions and working to build his portfolio, he provides mentorship to aspiring investors. This is done through one-on-one interactions and through his successful YouTube channel and blog.

Marcus does utilize his M.B.A. for more than real estate. As a consultant for a successful non-profit institution south of Chicago, he uses his expertise in the development of human capital. His philanthropic efforts help existing stakeholders develop in their capacity to serve those in need of assistance.

Education
Marcus completed his M.B.A. in 2011 from Olivet Nazarene University.

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Buying a home for a rental, flip, or a primary residence, there are a few things you need to look for when conducting a final walk-through.

As an investor and Realtor, I’ve seen some tricks by sellers. In this article, I’ll provide you my perspective on what to look for when conducting a final walk-through.

What to Look for in a Walk-Through When Buying Property

As a Realtor, I have a fiduciary responsibility to my buyer. I must be the eyes and ears of the transaction. I also have to understand what the seller desires. This can become difficult to navigate, but as long as the client’s best interest is represented, then the Realtor’s job is done.

Let’s discuss what a buyer needs to look for when doing a final walk-through. I have noted seven items in particular. These are not in the order of importance. However, all items can determine the likelihood of whether an acquisition will be disastrous or profitable.

Related: I Just Toured 3 Multifamily Properties: Here’s What They Taught Me

Infestations

An infestation can be something as harmful as ants or as detrimental as bed bugs or termites. Remediation of an infestation can be as simple as going to your local home supply store. But in the worst case scenario, fixing this type of problem could cost thousands. I highly recommend being proactive and having an inspection completed.

In the past, I was surprised when walking a potential flip and discovering the house was infested with bees. The picture below does not express the magnitude of the bee colony and hive, which spanned the entire inner wall.

Bee Infestation

Water Damage

Being cognizant of water damage can save you thousands. It’s important to look in areas where water might be evident, especially if there’s an indication of an aging roof.

Examine the ceilings for water spots. Other key areas to check are around the water heater and under sinks.

In regions where properties have basements, I suggest looking for moisture around baseboards and water lines on the dry wall or block walls.

Asbestos, Mold, & Lead-Based Paint

In most states, if not all, these are disclosure items. That means, by law if the seller is aware or there’s evidence of any one of these three issues, it must be disclosed to the buyer.

In the past, a real estate transaction hinged on the premise of “buyer beware.” With new state regulations, there’s an effort to protect the buyer. Asbestos, mold, and lead paint disposal must meet certain environmental disposal regulations. Therefore, the fees associated with remediation and disposal are higher than traditional disposals due to the carcinogens in the materials.

Related: Your 48-Point DIY Home Inspection Checklist

Plumbing and Electrical

Plumbing and electrical are possibly the most critical components to inspect. Utilizing a professional home inspector and having a contractor review the systems is essential. In older homes, cast iron piping is something that needs to be replaced for the functionality of the plumbing.

Also, in older homes, knob and tube electrical or buss fuses are problematic. Rewiring or upgrading the electrical will cost thousands of dollars, which can blow a rehab budget quickly.

For the above reasons, these seven items need to be evaluated prior to purchasing a property. But there are many more items, such as roofing, foundation, and other structural issues, that are critical to check, as well. For that reason, my suggestion to my clients is always to have a professional home inspection done.

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Have I missed any items that should be inspected?

List them in the comment section below.