Is Asbestos a deal breaker?

Question

Hello everyone,

I am currently searching for my first investment property to purchase and i came across one in my price range but the property details states that the house had a major fire 2 yrs ago. Interior has severe fire and smoke damage. Due to the fire the asbestos is floating in the air and is considered hazardous. The house was built in 1963... i don’t know if that info matters. Do y’all think i should still consider the home and get the asbestos removed? I looked online and it can cost between 500-5000 to get the asbestos removed. I know my home loan requires the property to be livable so i think that would be a factor as well. What do y’all think? Thank you!

Marc Winter · Answer

@Tamasia Williams, unless you are an experienced contractor, I'd stay away from a major fire-damaged rehab project for a first investment. Of course, if you have really deep pockets/reserves and are willing to have big cost overruns--throw money at the building--then full steam ahead.

Keep in mind going forward, the asbestos can be remediated if the price of the property is right.

Good luck!

Keep in mind going forward, the asbestos can be remediated if the price of the property is right.

Good luck!

Nick Rutkowski · Answer

@Tamasia Williams

If you’re in contract with the seller, you could ask for it to be removed before you move in. Maybe you both split the cost and you can add your portion to the end of your mortgage. I’ve done that before and it worked out. Everything is a negotiation.

Jeremy VanDelinder · Answer

I flip fire-damaged properties and own a fire damage restoration company. It can be a big undertaking, although there can be good profits in it IF the numbers are right and you have done your homework to know what you are getting into. @Marc Winter's advice above is sound--Unless you are rather experienced with this type of damage, it may be hard for your to tell the extent of damage.

The challenge with fire damaged properties is that there is more than meets the eye. For example, often fire damage is water damage--they put the red stuff out with wet stuff. Unmitigated water damage becomes mold damage and and there is the potential of extensive smoke damage in the same airspace.

I think I know what you are talking about with the asbestos--perhaps I can help explain. As many of you know, asbestos only becomes a problem if you "disturb" it (for example if there is asbestos in something it only has to be mitigated if you change it out.) Well, once there is a fire of any size, virtually everything is now "disturbed." So the fire damage and the asbestos remediation put together amplify the job dramatically.

I would recommend you find a fire restoration company/contractor to walk the property with you and give you a good understanding as to what needs to be done. There are many things that could be overlooked as part of the renovation.

Mark H. Porter · Answer

Did you state that the fire damage exists or was it repaired from two years ago?  If the place is still fire damaged, just make sure your offer covers the $20G or so of additional costs it will take to remove all the contaminated building materials to a certified location rather than your local dump.

If it has already been repaired, then there are different solutions.  I'm not sure what state you are in, but the existence of asbestos does not make a place unliveable.  There's just too many heating pipes, sidings, fire-resistant ceilings in boiler rooms, and others that means its tough to avoid.

Here in Vermont, if we suspect asbestos exists we just need to make sure it is contained.  For siding, just don't touch it (most will just vinyl side).  If on pipe, just make sure its wrapped in plastic.  If on a ceiling and not falling away, just don't mess with it.  I had a fire-resistant ceiling that had fallen down in a boiler room and it cost me $3500 to get 300 feet cleaned up.

The "floating in the air" thing I've never heard of.  Asbestos is a fiber and as such is heavier than air.  Everything I've ever read states the airborne particles of asbestos settle to a surface within 3 days.  I have no idea, if the place has been cleaned, that it should still exist.  I'd question where that assumption comes from.

Will Fraser · Answer

Hi @Tamasia Williams!  Welcome to the BP forums!  I would say this totally depends on WHAT the asbestos is?  Do they mean that the popcorn ceiling is asbestos, the exterior siding is asbestos, or is there asbestos all over everywhere?  If the popcorn ceiling is asbestos then I'd have it removed (its a two-fer . . . you get rid of the danger AND popcorn ceilings).  If the siding is asbestos then that is a significantly more costly ordeal and I would want you to get some specific bids from qualified contractors on this before making a go/no-go decision.

Best of luck!

Tamasia Williams · Answer

Thank you all for the information, much appreciated! I will look into other properties for now.

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