Do you typically buy homes to flip even if it needs a new roof?

Investor · Bay Area, CA · Member since 2020 · 72 posts · 43 votes

Hello everyone,

I am new to the house flipping business and have just started one with my partner from work in the Bay Area, CA. We are struggling to get offers accepted on homes and find properties that need a new roof or have mold/pest issues. We have walked away from several homes that needed a new roof, but I am starting to think that may have been a bad idea.

To experienced flippers: would you typically flip a home that needs a new roof? Do you calculate the cost of the roof repair and lower your offer based on that?

The homes in this market that just need cosmetic repairs are going way over asking, and we are getting beaten out easily.

Thank you for any help!

2 Reply

111 views

Most Popular Reply

Greg H.Pro Member

Moderator

Broker/Flipper · Austin, TX · Member since 2013 · 4k+ posts · 4k+ votes

The numbers are the numbers and if I can get an offer accepted where the numbers work, I will deal with almost any needed repairs. The only repairs I shy away from are environmental stuff, houses with fire damage and those with any drug residue issues such as a previous meth lab. Those add a level of stress that I don’t need

So if you can buy it at a price that allows a roof, I would proceed. The issue these days is that in many areas prices have stabilized but seller’s expectations off getting top dollar have not

4 Reply

See this reply in the discussion

23 Replies

Jump to latestLatest

Sort by

Greg H.Pro Member
Moderator
Broker/Flipper · Austin, TX · Member since 2013 · 4k+ posts · 4k+ votes
3y
The numbers are the numbers and if I can get an offer accepted where the numbers work, I will deal with almost any needed repairs. The only repairs I shy away from are environmental stuff, houses with fire damage and those with any drug residue issues such as a previous meth lab. Those add a level of stress that I don’t need
So if you can buy it at a price that allows a roof, I would proceed. The issue these days is that in many areas prices have stabilized but seller’s expectations off getting top dollar have not
4 Reply
Doug SmithPro Member
Lender · Tampa, FL · Member since 2013 · 2k+ posts · 2k+ votes
3y
The worse off they are the better for our real estate investment side. We'll even tear them completely down and start from scratch. We've found that we compete with too many other investors for the light rehabs. We've found that we get better value on the ones that most investors aren't looking for. That's one reason we tend to do higher-end deals...fewer competitors.
2 Reply
Brian Wilson
Investor · Longmont, CO · Member since 2016 · 185 posts · 156 votes
3y
Roof replacement, pop-top, etc. are all methods that some of us use. You just have to determine if you have some or all of the following items to ensure if it makes sense for you.
-Ability to manage this portion of construction (GC, Project Manager, your personal skills)
-Capital to undertake the project
-Desire to go through the process
-Makes sense from an ROI perspective
1 Reply
Ned CareyPro Member
Moderator
Investor · Baltimore, MD · Member since 2008 · 17k+ posts · 13k+ votes
3y
@Kevin G. Yes people who flip house oftern do houses that need new roofs. In my area we pretty much assume we will be putting on a new roof. (there are row houses with flat roofs)
2 Reply
Theresa HarrisPro Member
Member since 2019 · 15k+ posts · 11k+ votes
3y
A new roof wouldn't bother me if the numbers made sense. Running into mold or serious pest issues (especially in CA) would concern me.
0 Reply
Abe AlamPro Member
Member since 2020 · 62 posts · 5 votes
3y
ESPECIALLY if it needs a new roof.
1 Reply
Jonathan R McLaughlin
Rental Property Investor · Boston, Massachusetts (MA) · Member since 2016 · 2k+ posts · 2k+ votes
3y
At the end of the day, a roof is just 1 thing, and there are plenty of people can do it fast and well. And the work doesn't affect anything inside. Potentially a major problem for the seller, but an easy fix for you.
0 Reply
Eliott Elias
Investor · Austin, TX · Member since 2021 · 9k+ posts · 5k+ votes
3y
When flipping homes, you are going to encounter extremely distressed property. It is not uncommon to replace the roof. Look at other things, such as foundation, electrical, plumbing.
0 Reply
Bernard Joseph S.
Investor · NJ · Member since 2022 · 155 posts · 224 votes
3y
foundation far more important than the roof.
0 Reply
Tom Fidrych
Member since 2020 · 241 posts · 179 votes
3y
A roof is a pretty straight forward repair to estimate. See a bad roof as an opportunity if the purchase price is correct. Mold can be a little trickier as you have to figure out where the moisture is coming from. If the moisture is being drawn through a cement slab, to do it right you will have to figure out how to eliminate the moisture. Pests should not be an issue.
The thing that would give me the most hesitation in the SF Bay area is geotech issues-i.e., slides, earth movement, and foundation issues. These type repairs can be deep into the 6 figure range if not more and you will have to have test bores drilled and an engineer's stamp on a plan before you even put the remediation out for bid.
In my area of the Bay area, the price of new construction is between $700-$1,000/SF and up. Contractors are still so busy they are naming their price so factor that into your plan unless you are doing the work yourself.
1 Reply
Bob S.
Real Estate Consultant · Cleveland · Member since 2020 · 6k+ posts · 3k+ votes
3y
Quote from @Kevin G.:

Hello everyone,

I am new to the house flipping business and have just started one with my partner from work in the Bay Area, CA. We are struggling to get offers accepted on homes and find properties that need a new roof or have mold/pest issues. We have walked away from several homes that needed a new roof, but I am starting to think that may have been a bad idea.

To experienced flippers: would you typically flip a home that needs a new roof? Do you calculate the cost of the roof repair and lower your offer based on that?

The homes in this market that just need cosmetic repairs are going way over asking, and we are getting beaten out easily.

Thank you for any help!

Yes you are correct it IS a terrible idea to walk away. This is what we do, buy the worst house in the area. Why would you not buy a house that needs a roof. I strongly sugggest getting to your local meeting , learn then apply what you learn.
BTW ITS ALL about the numbers,
All the best
1 Reply
Alecia LovelessPro Member
Member since 2019 · 3k+ posts · 2k+ votes
3y
@Kevin G. I can get a roof done cheaply after the cost of materials. A roof would not deter me from doing a flip.
1 Reply
Henry T.
Member since 2022 · 1k+ posts · 1k+ votes
3y
A roof is nothing.
1 Reply
Kevin G.
OP
Investor · Bay Area, CA · Member since 2020 · 72 posts · 43 votes
3y
Wow! I guess we have really been dropping the ball on not offering on these. We are absolutely brand new to house flipping and it’s all a learning experience. We have been going completely cosmetic but our GCs does work on roofs and it’s also not hard to find roof contractors as well.
Does anyone find that it’s hard for hard money lenders to cover roofs as apart of the 100% rehab costs ?
0 Reply
Account Closed
Developer · Austin, TX · Member since 2018 · 23 posts · 15 votes
3y
Quote from @Kevin G.:

Hello everyone,

I am new to the house flipping business and have just started one with my partner from work in the Bay Area, CA. We are struggling to get offers accepted on homes and find properties that need a new roof or have mold/pest issues. We have walked away from several homes that needed a new roof, but I am starting to think that may have been a bad idea.

To experienced flippers: would you typically flip a home that needs a new roof? Do you calculate the cost of the roof repair and lower your offer based on that?

The homes in this market that just need cosmetic repairs are going way over asking, and we are getting beaten out easily.

Thank you for any help!

Flipping is rarely a great business model. People will boast big number about it and point to HGTV Lala land crap but it is mostly a fairytale. I have made money flipping, don't get me wrong, but it's not the best ROI. In the current market people are getting murdered by overpriced deals. I would hate to be in that game right now. I actually believe prices (after summer) will continue to trend down so I am not a buying in major markets. I prefer stable markets. You should invest in areas out of Cali. I left Cali real estate back in 2018, best finical move of my life. There are way better markets with large returns in hidden gems in America. Message me to talk.
2 Reply
Matthew Paul
Severna Park, MD · Member since 2013 · 7k+ posts · 7k+ votes
3y
If you want to flip houses and are afraid of replacing a roof , get out now . Most of my deals need roofs , plumbing , electrical , bathrooms , kitchens , windows , the roof is one of the easy parts .
Flipping houses , you meed to know your numbers , and you need to be able to look at a house and figure what work is necessary . There will always be things you missed
Flipping houses isnt anything like you see on the TV shows .
3 Reply
Jerry V.
Contractor · Richardson, TX · Member since 2022 · 265 posts · 146 votes
3y
(from a Roofer!) My first though, OF COURSE replacing a roof is easy enough to do! lol BUT, then you have to think about you in CA, and your looking at THOSE prices there (inflated)... but if it's LOCAL to you, and you know/trust the Contractors, this shouldn't be an issue or question. IF y'all (yes Y'ALL) are looking in other states, then your going to have a hard time, because it's hard to find reliable Contractors outside your local area. You loose so much control and IF things go wrong, you really can't do anything about it! :(
Thus, as many have said, PLEASE educate yourselves and join a local REI Investment group or organization in your area. Or network online! (hhmmmm.... wonder where?) If you don't know how to evaluate a property that NEEDS things, stop now and get that knowledge of the industry and of what you want to do. If you/y'all just have $ to burn and want to do flipping etc, fine.. but hire someone or an REI group and be the Angel Investors (hands off money people) to fund the deals and make the money that way.
Good luck!
0 Reply
Carlos Ptriawan
Member since 2019 · 7k+ posts · 4k+ votes
3y
Quote from @Kevin G.:

Hello everyone,

I am new to the house flipping business and have just started one with my partner from work in the Bay Area, CA. We are struggling to get offers accepted on homes and find properties that need a new roof or have mold/pest issues. We have walked away from several homes that needed a new roof, but I am starting to think that may have been a bad idea.

To experienced flippers: would you typically flip a home that needs a new roof? Do you calculate the cost of the roof repair and lower your offer based on that?

The homes in this market that just need cosmetic repairs are going way over asking, and we are getting beaten out easily.

Thank you for any help!

LOL, best house to flip in bay area is house that has mold and roof issue. It's not expensive to fix those problem.
0 Reply
Carlos Ptriawan
Member since 2019 · 7k+ posts · 4k+ votes
3y
Quote from @Jerry V.:

(from a Roofer!) My first though, OF COURSE replacing a roof is easy enough to do! lol BUT, then you have to think about you in CA, and your looking at THOSE prices there (inflated)... but if it's LOCAL to you, and you know/trust the Contractors, this shouldn't be an issue or question. IF y'all (yes Y'ALL) are looking in other states, then your going to have a hard time, because it's hard to find reliable Contractors outside your local area. You loose so much control and IF things go wrong, you really can't do anything about it! :(
Thus, as many have said, PLEASE educate yourselves and join a local REI Investment group or organization in your area. Or network online! (hhmmmm.... wonder where?) If you don't know how to evaluate a property that NEEDS things, stop now and get that knowledge of the industry and of what you want to do. If you/y'all just have $ to burn and want to do flipping etc, fine.. but hire someone or an REI group and be the Angel Investors (hands off money people) to fund the deals and make the money that way.
Good luck!

There's no need even to join REI if one has reliable contractor that can do everything.
Problem with bay area is actually competition, even house that's almost falling apart still got outbid from more professional flipper that has more resource than me.
0 Reply
Russell BrazilBusiness Member
Moderator
Real Estate Agent · Washington, D.C. · Member since 2012 · 17k+ posts · 30k+ votes
3y
Every property Ive ever flipped needed a new roof.
[email protected]301-893-4635 Podcast Guest on Show #192
District Invest Group545 Reviews
Website View Page
0 Reply
Jerry V.
Contractor · Richardson, TX · Member since 2022 · 265 posts · 146 votes
3y
Quote from @Carlos Ptriawan:

Quote from @Jerry V.:

(from a Roofer!) My first though, OF COURSE replacing a roof is easy enough to do! lol BUT, then you have to think about you in CA, and your looking at THOSE prices there (inflated)... but if it's LOCAL to you, and you know/trust the Contractors, this shouldn't be an issue or question. IF y'all (yes Y'ALL) are looking in other states, then your going to have a hard time, because it's hard to find reliable Contractors outside your local area. You loose so much control and IF things go wrong, you really can't do anything about it! :(
Thus, as many have said, PLEASE educate yourselves and join a local REI Investment group or organization in your area. Or network online! (hhmmmm.... wonder where?) If you don't know how to evaluate a property that NEEDS things, stop now and get that knowledge of the industry and of what you want to do. If you/y'all just have $ to burn and want to do flipping etc, fine.. but hire someone or an REI group and be the Angel Investors (hands off money people) to fund the deals and make the money that way.
Good luck!

There's no need even to join REI if one has reliable contractor that can do everything.
Problem with bay area is actually competition, even house that's almost falling apart still got outbid from more professional flipper that has more resource than me.

Sorry Carlos, call me paranoid or whatever but ... will Never put ALL my trust and hopes on just ONE person (like entrusting everything to a GC). And if no REI group or mentor, partner etc... just learn the Sleuthing (finding) of deals, financing, negotiations, closing, contracts, etc etc etc all on your own eh? Hey, if it works for you, great! :P
0 Reply
Carlos Ptriawan
Member since 2019 · 7k+ posts · 4k+ votes
3y
no i have gc that works solely for me so something like roof doesn't scare me that much. I went to REI only once, it's the contractor that really important like yourself.
0 Reply
Bill J FayPro Member
Lender · San Diego · Member since 2023 · 216 posts · 209 votes
3y
As someone who grew up in CA, I can see why you would look away when a roof needs to be replaced. The fair weather keeps roofs alive a lot longer, compared to the majority of the country where weather is a factor. Flipping in CO, we have to replace roofs fairly often with hail damage, meaning there is great competition with roof contractors. The next time you drive by a roofing contractor with a phone number on their truck, call and get general pricing so you can have them in your back pocket on the next house you'd like to offer. Be prepared up front so you can score a deal when ready!
0 Reply

Join the conversationCreate a free account to reply, vote on answers and follow this thread.