To buy Meth or Not to buy Meth...

Buying & Selling Real Estate
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To buy Meth or Not to buy Meth...

Adrienne Donner
Real Estate Agent 路 Salt Lake City, UT 路 Member since 2019 路 29 posts 路 13 votes

We are looking at our first flip. The previous buyer blacked out after the house tested positive for meth.

After speaking with a remediation expert in the area it seems that even with that cost this flip is a good buy.

Has anyone else ever fixed a meth house. Does your state require you to disclose it at the sale and or to tenants?

Anything else I need to worry about with this?

TIA!

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Eric Gardiner
Real Estate Agent 路 Salt Lake City , UT 路 Member since 2017 路 155 posts 路 92 votes
6y

@Adrienne Donner Hi Adrienne, I sold an apartment I owned in Salt Lake City that tested positive for meth. The first contract fell apart because it tested positive. I then remediated it and relisted and it sold quickly. Once it is remediated no one cares. You do need to disclose this but also discuss remediation in the seller disclosure. 

As long as the cost of remediation works into your flip budget I say go for it. Your realtor should be able to advise you on this.

Let me know if you have more questions. 

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  • Account Closed
    Financial Advisor 路 CA 路 Member since 2012 路 128 posts 路 76 votes
    7y

    Kudos for having the guts to even thinking about it.

    0Reply
  • John LewisPro Member
    Member since 2019 路 11 posts 路 1 vote
    6y

    How did it work out? I鈥檓 in the same situation in Utah

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  • Eric Gardiner
    Real Estate Agent 路 Salt Lake City , UT 路 Member since 2017 路 155 posts 路 92 votes
    6y

    @Adrienne Donner Hi Adrienne, I sold an apartment I owned in Salt Lake City that tested positive for meth. The first contract fell apart because it tested positive. I then remediated it and relisted and it sold quickly. Once it is remediated no one cares. You do need to disclose this but also discuss remediation in the seller disclosure. 

    As long as the cost of remediation works into your flip budget I say go for it. Your realtor should be able to advise you on this.

    Let me know if you have more questions. 

    2Reply
  • Race Ostler
    Investor 路 Orem, UT 路 Member since 2014 路 25 posts 路 22 votes
    6y

    @John Lewis,

    I can vouch for what Eric said. I bought a fourplex two years ago that had meth in it. During the walkthrough the seller's agent said "remember if an apartment smells like cat urine it could be meth". I took the hint and got it tested and it came back super high.

    I got some quotes from professional remedation companies that it wold be just $4,000 to fully remediate it. The city will come in and put a do not enter on the outside of the door (or inside of the door if you're lucky). Essentially a very temporary condemnation. Then once it's officially clean, you don't have to disclose it to future renters or buyers because it's gone. Only time you might have to bring it up if for some reason you get a subpoena.

    Ending up being a very lucrative deal because I was able to get a lot more than $4k off the purchase price

    0Reply
  • John LewisPro Member
    Member since 2019 路 11 posts 路 1 vote
    6y

    Thanks was able to get $30k off with a little work馃Should be great deal. It wasn鈥檛 a cook house just some partying fools but seller don鈥檛 kniw

    0Reply
  • Adam TafelBusiness Member
    Real Estate Agent 路 St. Paul, MN 路 Member since 2017 路 580 posts 路 395 votes
    6y

    In most markets you need to disclose meth manufacturing for a sale, not sure about renting. If it's a SF flip, family home, a ton of buyers will not even consider it. Not trying to be negative or say it's a bad deal, just be realistic about the stigma surrounding meth and how it will effect the marketing of the property. You're agent will surely do a good job of countering objections, assuming you have it remediated and can prove it. 

    Murders also need to be disclosed - does the fact that someone was murdered actually effect a new owner or tenant in a tangible way? Of course not. But they know that it happened, and they probably won't forget it. 

    Again, I'm not trying to be negative, just providing some things to consider. Good luck on the flip! 

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  • Stephen KeigheryBusiness Member
    Rental Property Investor 路 New Orleans, LA 路 Member since 2018 路 716 posts 路 555 votes
    6y

    @Adrienne Donner do not buy Meth, it's illegal and very addictive 馃槀

    In terms of a Meth house, I would buy it if the price is significantly discounted to compensate for the rehab.

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  • Andy Jenkins
    Realtor 路 Minneapolis MN 路 Member since 2018 路 84 posts 路 61 votes
    6y

    @Adrienne Donner

    Did it test positive, high, or very high? Positive tests are REALLY common and typically just involve a cleaning of the air ducts and furnace. If you鈥檙e ripping out most of the material on your flip (eg back to the studs), and replacing the furnace, that鈥檒l go a long way to help. If you鈥檙e just doing a few cosmetic changes, I鈥檇 get it all cleaned up first, then paint the cabinets etc.

    Talk to your local meth clean up companies. They know about this stuff! It鈥檚 always better to over clean and disclose!!!

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  • Adrienne Donner
    OP
    Real Estate Agent 路 Salt Lake City, UT 路 Member since 2019 路 29 posts 路 13 votes
    6y

    This was a post from last summer. It was a fairly high number. But the bid was about $5k to re-mediate but we didn't get the house. After we put on offer on it we did walk through it and it had a huge hole in the kitchen ceiling that went up through the roof! haha it was listed a 4 bed 2 bath but was only 2 bed 1 bath. The floor plan could have been adjusted to that.
    In Utah once it is re-mediated it is not needed to say it had tested positive for meth. We learned a lot from that experience. I would buy one if it came up again. ;-)

    1Reply
  • Marlen Weber
    Specialist 路 Plano, TX 路 Member since 2020 路 2k+ posts 路 861 votes
    6y

    Tons of great information on how to approach such a unique situation. Thank you all for sharing. It is unfortunate that properties test positive for meth, truly sad. The good news is that once remediation occurs, it seems to be an issue of the past. 

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  • Justin JohnsonPro Member
    Fort Smith, AR 路 Member since 2018 路 122 posts 路 70 votes
    5y

    I know this thread is a little older but...This is a very helpful thread!

    I have the opportunity to buy my first off the market property and the neighbors have named the place "meth mansion".  I don't think that it's a LAB but believe that meth was cooked there a few times before the landlord/city got involved.  I know there is rehab that needs to be done.  How do I find a remediation company that deals with meth/drug problems?  Newbie here looking to buy my second property, the price is right on this one, and *could* be even better with negotiations.

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