Triplex is being offered at 115,000 but it has foundation issues, and the previous transaction got cancelled after the inspection reports. However, after analyzing data it provides excellent cash flow of about 14.5% COCROY and long-term tenants albeit under rent. I am new into investing and was wondering if I should take the risk and invest into it granted I do not know much about foundations of a home.
Sounds risky because you are new to investing and you don't know much about foundations. But with that said, some people can buy these homes and do real well with them. I purchased a house that was in a prime area that nobody wanted because the foundation was literally falling in. After renting a backhoe and digging out around the foundation walls, I was able to push the wall back out, reinforce it with rebar and waterproof it all for 5000. If you are willing to educate yourself on how to do this, then maybe it could be worth it. Best of luck!
@Daniel Nguyen You could always have several structural engineers look at the property to quote on the estimated cost of repairs. A home with foundation issues can be a gold mine. Just do the extra research and figure out if this is the one.
foundations SCARE people... its an emotional response. They also assume the repair is mega $$$. Get some real numbers, dont tell anyone, then underbid the S out of it.
My best deal came about because of a foundation issue that scared everyone. I got a solid bid, used it to get the house for cheap and then fixed everything after purchase. Just cover yourself for the issue and know what it costs to fix.
It is a conventional (piers) or slab? Conventional foundations are an easy fix. If it's a slab, it depends on the cause of the problems and the underlying soil. Anything can be fixed however if the underlying problem is the soil then you will continue to have possible problems. I've done many many foundations. Some were really big jobs, some were small. I tend to stay away from them now just because I don't need to deal with them.
and for resale purposes, you'll want to get a lifetime warranty for the repairs. Buyers in the future will want that.
Thanks all! I just put my offer in, and having a foundation contractor take a look at it.