SFH Red Flags

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SFH Red Flags

BRadley Cottam
Overland Park, KS · Member since 2013 · 11 posts · 0 votes

Next Week I am actually starting to look for my first SFH investment property. Im looking between 100-200k homes build in the 70's. Most of the ones I am checking into have been updated in the past 10 years. I am have done a ton of homework, much right here on the site. I've got most of my forumlas down and I know what I can personally justify or not justify buying. My question is now that I am actually looking, I am trying to find a list of red flags that would cause me to not even consider a certain house. Obviously roofs, etc. but I am just looking for a list of quite a few things that should disqualify a sfh from my list. Thanks for any help and this forum has been extremely helpful to me over the last few months.

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Lynn McGeein
Real Estate Agent · Virginia Beach, VA · Member since 2012 · 2k+ posts · 1k+ votes
13y

I would suggest making sure you know the weird issues for your area -- for instance, when we started looking in Maryland, we found out (seems like, anyway) the entire state seems to be sitting on top of natural springs that like to run through basements if the pumps stop working in a storm. Doesn't matter what kind of deal you get on it if you'll be fixing water damage every other year. We always look for drainage issues, how far from landfills, pig farms, etc. We've ruled out a lot of homes simply by mapping with satellite feature and seeing what's around (quarry starting next street over, huge power lines, beautiful view of industrial complex, etc.)

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  • Dawn AnastasiPro Member
    Rental Property Investor · Milwaukee, WI · Member since 2013 · 6k+ posts · 4k+ votes
    13y

    Hello BRadley Cottam and welcome to Bigger Pockets!

    (Almost) nothing disqualifies a house depending on the price. The things that would disqualify a house for "me" personally:

    - Squatters living there
    - Crumbling foundation
    - House has gaping holes - could be animals living in there, dying
    - House has been condemned
    - Burned out

    Other investors might be willing to take these things on.

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  • Lynn McGeein
    Real Estate Agent · Virginia Beach, VA · Member since 2012 · 2k+ posts · 1k+ votes
    13y

    I would suggest making sure you know the weird issues for your area -- for instance, when we started looking in Maryland, we found out (seems like, anyway) the entire state seems to be sitting on top of natural springs that like to run through basements if the pumps stop working in a storm. Doesn't matter what kind of deal you get on it if you'll be fixing water damage every other year. We always look for drainage issues, how far from landfills, pig farms, etc. We've ruled out a lot of homes simply by mapping with satellite feature and seeing what's around (quarry starting next street over, huge power lines, beautiful view of industrial complex, etc.)

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  • Account Closed
    Inspector · Baltimore, MD · Member since 2013 · 7 posts · 3 votes
    13y

    Lynn, you are right about some of areas of Maryland. There is a street I know of that DOES have a stream under it and many of the homes on one side of the street spanning several blocks have water problems in heavy rains.

    Somehow and for some reason, someone called it Lakewood Avenue...go figure.

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  • Robert AdamsBusiness Member
    Real Estate Broker · Henderson, NV · Member since 2009 · 1k+ posts · 373 votes
    13y

    What I find useful is to have a limit on the dollar amount it will take to rehab the property. the in your due diligence period have your inspections etc and ANY red flag that shows up should be analyzed and have a dollar value assigned to them in order to calculate what it will cost to get it up to speed. If that cost exceeds the limit you have set and the seller is unwilling to renegotiate, you need to move on and find another deal.

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  • Stephanie Dupuis
    Residential Real Estate Broker · Bremerton, WA · Member since 2013 · 494 posts · 142 votes
    13y

    You received good info above.

    Red flags depend on your goals and temperament. What you're willing to do (time and energy) and money. For me, I'll consider almost anything as long as it can be fixed "permanently" - meaning, nothing is ever fixed permanently, a roof will eventually need to be replaced. But, a bad roof can be replaced and then last the "life" of the roof. OTOH, springs under the house - yuck. Ongoing problem. I avoid ongoing problems.

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