I recently found a 2100sqft, single family home built in 1925, in a great area with some really good numbers. I'm just a little unsure of the rehab as it should need a fairly extensive one. I'm working with a contractor I haven't met before but was referred to me by my realtor and he thinks the rehab should be around 30k just at first look, and if we can do it for 30k I would be pumped! But, with a 1920's house I feel like their might be some really expensive unexpected repairs such as, old plumbing, electrical, sewer line etc... I'm wondering if anyone has some insight into what I should look for and possibly what is a common hassle for a house built in the 20's? Also, this would be my first deal. BTW i'm still deciding between making this a BRRRR deal or just a flip.
We've done a lot of older houses (including a few 19th century ones) and while they are generally more expensive, they certainly are doable. A lot of it is checkable beforehand though. For example, if you can go in the basement, you can see whether any of the electrical has been upgraded or if it's still knob and tube. (Now they may have replaced the wiring in the basement, but nowhere else of course.) You can see if it's old galvanized plumbing; which probably needs to be replaced. The walls are made of plaster and lathe, which is harder to patch than drywall, etc.
Just make sure to investigate all of those things carefully and put in a larger contingency for unforeseen expenses than you would with a newer property. If you do that, you should be OK.
Get a second opinion. If able, get a third. A lot of contractors don't like to give bids to people they don't know because there's a 66.6% chance you won't hire them. Offer to pay them $100 to make it worth their while.
When you're taking on something unfamiliar, you've got to get multiple opinions to know you're on the right track.
All of our houses have been pre 1930s - lot of times it’s just foundation, brickwork needs repointing, bad floor joists, entire electrical and plumbing systems have been so worked over/pieced together it gets to be a maintenance issue.
Find someone who works mostly on old homes. Makes a world of difference.
Andrew thanks so much for replying! This is amazing I just watched your youtube video on estimating rehabs and the scope of work, this morning before I went and looked at this house and I used your checklist and took tons of notes on everything you talked about! Bigger pockets is really something special.
Anyway, there is no basement, but as far as I can tell the electrical is somewhat updated, but there is the old galvanized plumbing. I'm planning on getting the sewer lines scoped as well as doing a more comprehensive checklist done to give to the contractors tomorrow. Also, you said in the video that you usually put in a 20% contingency, so would you recommend maybe a 25-30% on an old house?
Great advice I was planning on doing this but it seems like my realtor and contractor just expect that I will go with him no questions asked. So, thanks for the little reminder I will definitely get another opinion or 2.
@Nick Seginowich I don’t know what the energy code is like where you are looking at the house, but pulling a permit for a full re-hab may trigger updating the insulation, air sealing, windows, etc to a higher efficiency (which can be costly).
I would make sure to do your due diligence before pulling the trigger
Lots of good ideas above, I won't repeat.
Don't forget to look at the HVAC system. I have bought several old houses and sometimes one can not get through under the floor as the crawl space is too small to fit a body, and there is not an accessible space between floors. Putting in ductwork is impossible at times. It is not uncommon for some rooms to have no heat, and just portable heaters are used. If you do need to add heat or replace it, look into mini splits. I have one 1900 house with 5 bedrooms and the best HVAC solution is 2 mini split systems and a furnace/central air system for the half of one floor with an accessible crawl space to add duct work. House was a rental for decade with only window air and space heaters. Costing me $17k to put in heat and cooling.
Also look at electrical outlets. Most often there is one outlet per room in the older houses and this will not be adequate for a modern family. Plan on adding a lot more capacity.
Last thing to add, stand back and look hard for bowing walls, floors that are not quite level, rooms that do not look like the walls are the same height. You could have foundation issues, or possibly old termite damage where major support beams have disintegrated or maybe support piers that have sunk or fallen over or rotted. Lifting a house to replace termite destroyed beams is pretty hard and expensive. And you already know the cost of foundation issues. Then again, if you have access under the house floor leveling can be inexpensive, sort of, considering the piers, etc that are added.
Get a home inspection.
Awesome advice guys thank you! I went through with the first contractor today and he's thinking as long as the electrical and plumbing are working theres no reason to update anything because "it's been there for 100 years it'll work fine". Any advice on leaving these big ticket items alone just because they work?
i own old apartment houses most of them built around 1900 . Your going to see electrical issues with knob and tube and plumbing leaks especially if it hasn’t been updated from the old cast iron pipes . I wouldn’t go crazy on rehab if it’s just a rental . It’s nothing to sink 50k in an old Victorian house so watch your budget focus on stuff that is safety and preventative maintenance related ,not cosmetic
Really, you want a 100 year old roof? HVAC? cabinets? flooring? And just because 100 year old plumbing and electrical is there does not mean it works well. Electrical use even ten years ago is much different than now. I completely tore out the walls in a room as all the drains from the upstairs bathroom were leaking in the walls. Yep, someone was living in the house before the foreclosure, but they never had the money to fix it. You really cannot tell how much it was leaking until you dig into it.