Buying 50+ years old houses for buy and hold

12 Replies

I have an old house (built in 1920) and two homes built in 1998 and 2003 (I think)

Never had any issues with any houses. I did have to put a new roof on an old house though because I was worried it may start leaking, and it cost me 2K...

Other than that no problems.

But, despite my good luck with my "old-ie" I have always been scared to buy old houses (By old I mean 50+ years old).

I thought I should focus on buy and holds that are less than 30 years old and cost around 100K and rent for 800$-1K...

But lately Ive been seeing a lot of people doing 30-50K older houses and rent them for 500-700$

1) What do you guys think? What is better?

2) Someone I know buys 30K houses and redoes plumbing, electrical, etc which will be another 20-30K and then he rents them for 700$...My concern is, when you buy a house that is that old, it is probably possible that the rehab may be around 100K, not 20-30K....Even if a house does require 20-30K rehab such as electrical, plumbing, etc, what are the chances that structurally its good and sound? Plus foundation....I don;t know...

What are your thoughts?

@Mary Jay I buy houses where the financial numbers make sense. Those numbers are more important to me than the age of the home. We have had to replace roofs and plumbing but we just factor that into the rehab numbers. 

For us, the foundation of the home hasn’t had as much to do with the age of the home. Some newer built houses have had issues with the the foundation whereas some really old homes have had no issues with the foundation. It just depends on the specific house and the ground it was built on. In some cases, some of the older homes have been built better than some of the tract homes that have used cheep materials. So I don’t know if I would get as stuck on the age of the house (it can come into factor in Athens appraisal though). I would just encourage you to get a plumbing and roof inspection before the inspection period is up when you are buying.

Originally posted by @Shiloh Lundahl :

@Mary Jay I buy houses where the financial numbers make sense. Those numbers are more important to me than the age of the home. We have had to replace roofs and plumbing but we just factor that into the rehab numbers. 

For us, the foundation of the home hasn’t had as much to do with the age of the home. Some newer built houses have had issues with the the foundation whereas some really old homes have had no issues with the foundation. It just depends on the specific house and the ground it was built on. In some cases, some of the older homes have been built better than some of the tract homes that have used cheep materials. So I don’t know if I would get as stuck on the age of the house (it can come into factor in Athens appraisal though). I would just encourage you to get a plumbing and roof inspection before the inspection period is up when you are buying.

 I guess my though process is this: if I buy a 100 year old house, how long will it last? 20-30 years? may be 50? Will it last another 100 years? Probably not..

If I buy a 30 -40 year old house, it probably will last me another 100 years with more probability vs if I buy a house that is 100 years old already...

Am I right?

I don’t think the age of the house is all that relevant. Get a home inspection. There are some houses that are 100 yrs old and in great shape, and some houses that are 30 yrs old and in terrible shape.

I would rely on the analysis and the home inspection.

Age doesnt matter , its how well its been maintained . 

Agreed with others, plus the old houses many times present opportunities. Old houses with old owners who are downsizing or moving to nursing homes, many times the property is mechanically solid but the cosmetics are from 1970. Perfect BRRRR or flip opportunity! Just buy at the right price...

I buy old houses all the time. As long as they are solid homes I have no problems with them. I try to find homes that already have updated electrical work but will still buy them even if they dont (as long as the price is right.)

Plumbing doesn't bother me as it is something I have learned to do myself and is very easy to do. I just re-plumbed a house that was built in 1900. Just finished it up today actually. 

I also look for older houses with an ample crawl space because its only a matter of time until you have to get under there and do some work on the old house.`

@Mary Jay I think there can be some concerns with asbestos, certain types of wiring like knob and tube as well as cast pipe plumbing as over time it closes in on itself but all in all there is something to be said about the materials and quality of older homes. Lumber quality was much better, building practices were better and dare I say craftsmen were generally better.

 A good inspector should spot most of the big issues. I think, properly maintained, an older home would far outlast a newer home.I am just getting my feet wet in R.E. investing but I've worked in trades most of my life in both new build and restoration, residential and commercial, in my opinion older homes far surpass newer homes in term of quality. As far as the foundations, if they are failing there are usually obvious signs like buckling in the wall. Large cracks that take in water etc. I've rebuilt a fair amount of foundations and even when they show signs of movement it can be many years till they need full rebuild. 

@Mary Jay I agree with @Shiloh Lundahl I look at the numbers not the age of the homes. I would definitely get an inspection but the numbers are more important. I'm in Cleveland where there are a lot of older homes, some even historic and since 2008 this has been a very good investment market. 

Originally posted by @Mary Jay :

I have an old house (built in 1920) and two homes built in 1998 and 2003 (I think)

Never had any issues with any houses. I did have to put a new roof on an old house though because I was worried it may start leaking, and it cost me 2K...

Other than that no problems.

But, despite my good luck with my "old-ie" I have always been scared to buy old houses (By old I mean 50+ years old).

I thought I should focus on buy and holds that are less than 30 years old and cost around 100K and rent for 800$-1K...

But lately Ive been seeing a lot of people doing 30-50K older houses and rent them for 500-700$

1) What do you guys think? What is better?

2) Someone I know buys 30K houses and redoes plumbing, electrical, etc which will be another 20-30K and then he rents them for 700$...My concern is, when you buy a house that is that old, it is probably possible that the rehab may be around 100K, not 20-30K....Even if a house does require 20-30K rehab such as electrical, plumbing, etc, what are the chances that structurally its good and sound? Plus foundation....I don;t know...

What are your thoughts?

 It'd be impossible to need to do a $100k rehab on one of those $30k-$50k houses folks are renting out for $500-$700/mo. Lots of houses in that price range that rent for that amount are pretty small. As for structural & foundation issues make sure you get an inspection prior to closing. It's pretty easy to tell if a home has major structural issues.

I've bought a number of properties that were 60-70 years old and needed significant work (zero maintenance for the last 30 yrs and appeared as if the TV show Hoarders was recently filmed there)....my typical budget is $20K- $30K including major items like roof, windows, plumbing/electrical upgrades- you can do a lot to the typical 1200 sq ft rental for $25K.  I have a two family that's closing in on a hundred years old and there's no difference between that one and the others in terms of issues or condition.   

Houses don't start automatically deteriorating after 20-30 years, lack of maintenance or faulty repairs is what causes issues.  As someone said, its about the numbers not the age of the house.  I have seen some newer houses that are going to have issues in a short period of time due to the way they were built/materials used.....so anyone buying those and relying on age as an indicator of the amount they're going to have to invest is going to be in for a surprise.

Interesting...You guys are broadening my horizons...Never thought of it that way. Always have been told that newer houses are better product vs older houses...

Thank you all for sharing your wisdom!

I really, really, really appreciate it!

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