Should I be concerned investing in an older property? (1920)

[Nicole S.]

Hi BP!

I’m thinking of putting an offer on a 3-unit that was built in 1920. Besides the obvious higher capex percentage I should keep in reserves, what else should I consider?

Thanks BP!

Nicole

[Jack Smith]

It depends... What are you looking to do with it?  Is it rent ready or will it need rehabbed?  Are you keeping or flipping?  What are the market demands?  What is the weather (presuming Ohio... funace and windows are pretty important around here)?  ...  

If it’s rent ready don’t go looking for extra expenses, unless you want to increase rent range.  If the general home inspection tells you many of these things are present from that era it doesn’t mean they need replaced right away, or at all just to meet today’s standards.  Most of them will work fine for many more years.  Fix what is needed and budget for future expenses as they come up.