Rental Property Investor · Irvine, CA · Member since 2015 · 18 posts · 5 votes
I just recently came across a property that has extensive fire damage. Have not done a walkthrough yet. Did a drive by and the exterior is intact as is the roof. So it seems the fire was contained mainly to the first floor. Wondering what are some things to look for when I go walkthrough the property beyond just extent of cosmetic and structural damage.
In my grunt work days I worked for a builder who had an arson fire in a newly construction home. We removed everything that was fire and smoke damaged and of course replaced any framing that was badly damaged. Then, everything that remained anywhere near the fire was sprayed with a sealant to contain any smoke odor. I do not know what he used as sealant but he was adamant that he did not want the faintest smell of smoke in the home.
Real Estate Investor · Longview, TX · Member since 2015 · 122 posts · 62 votes
11y
@Jonathan Wheeler Good topic, I have come across the same thing in my area. I have read some of the other threads about the same subject and it seems to be mixed thoughts about fire damaged homes. I am taking a look at one tomorrow. In NY it will probably be different than TX, but I think if I can get if for less than 10K I can drop a modular home on the land since its in the city limits and still get good cash flow.
That's my biggest concern getting into a project like that. Walking into a newly remodeled home and smelling smoke would be a huge turnoff. It would probably be a good idea to talk to some contractors who specialize in fire damage remodels and find out what steps they suggest. This house has huge potential. One of the biggest duplexes I have ever come across. 8br 3ba, 4,800sq ft. Large scale also means large rehab costs.
I agree, having a contractor that specializes in fire damage (like Servpro) take a look would be a good idea.
Wow, that is a big duplex. You mentioned the first floor, is it a side by side townhouse style or an upper/lower style?
Do you know what the market rent would be for a unit that large? In my area a 4 bedroom is not going to demand a significantly higher rent than a 3 bedroom but will likely require more maintenance. On the other hand if your area does not have a big supply of rentals that large you may be able to capitalize. Personally, and in my area, I would make sure the numbers work based on a high 3 bedroom market rent to make sure I am covered.
Sorry, I was not working on that job when it finished to give you a first hand answer to if it worked. However, the builder was very experienced and the house was high quality backing to a golf course so I would expect that it did work.
I found the following post by @Stevan Sheriff in another discussion and thought it might be useful. Definitely plan on replacing anything porous like carpet and sealing/painting everything else. Good luck!
Originally posted by @Steven Sheriff:
Fire damage repair will be 200-300% the cost of a new work. Smoke penetrates everything: insulation, carpets, any unsealed wood framing-interior of cabinets-lite fixtures, hvac system, etc. Then comes the disclosure statement on the resale...
Real Estate Investor · Rossville, GA · Member since 2014 · 218 posts · 96 votes
11y
I just finished a burnout flip. My advise would be to run lol. We had to gut the home completely because the homeowner had ripped all of the wiring out of the home and put so many holes in the drywall. The majority of the odor was in the attic since the smoke rises. Once the house was gutted and any charred wood was replaced, we used an odor blocking primer I am sure most of you have used. Kilz. This is what the city inspector suggested and advised us to use. I have done burnouts in the past where it was mainly smoke damage. We clean the walls and then use the same primer (kilz) on the walls and ceilings. After that it's business as usual. Below are before and after of the living room. I can email you the pics of the complete reno if you are interested. Let me know if you have any other questions. I will not do another burnout in the near future unless it's a great deal...which i thought this was. Way underestimated the costs but still profited. The difference was the time it took to finish vs a paint and carpet flip. hope this helps. Best of luck, Mike
Contractor · Los Angeles, CA · Member since 2015 · 4k+ posts · 1k+ votes
11y
Kilz is right. Youre looking at 40-50/sq ft less salvageable items. Smoke smell isn't a big deal, you just mask them with kilz and something else at the attic, or remove everything then apply a good odor killer.
Rental Property Investor · Irvine, CA · Member since 2015 · 18 posts · 5 votes
11y
@Craig Wilcox
I believe it is a side by side duplex. It's difficult to get comps in the area because of the size. There are not many properties in the vicinity that closely compare. The market for 4br units I believe is pretty high. There is a large population of young college grads in the area that tend to go for rentals like that thus making them pretty desirable. Thanks for finding that post. That's great advice.
I definitely appreciate the warning. I don't want to get into a complete gut and rebuild on a 4800sq ft property. It has alot of upside and potential, but I am pursuing it carefully. Not looking to get in over my head. I have used Kilz primer before. Great product! Never used it in a smoke damage application. I would love to see some pics of the before and after of your project.
Wholesaler · Salt Lake City, UT · Member since 2009 · 1k+ posts · 401 votes
11y
I have done 3 of these and decided I would never do number 4. I knew 2 contractors that used to buy and rehab these so I just started wholesaling them to these guys. What I also did was look for almost complete burns where the foundation was still intact, I had several buyers for these because some of my small builders could get a good price on the lot and with the foundation intact they could save about $27,000 in impact fees in my county.
The one thing I found out on the three I did was that the fire damage could travel far and wide and if you think it will be localized to the burn area you may be in for a big surprise.
Rental Property Investor · Irvine, CA · Member since 2015 · 18 posts · 5 votes
11y
That's a pretty extensive rehab @Paul Ortiz. Did you use your own contractors, or hire fire damage specific contractors? What were some of the unexpected expenses that you encountered linked to the fire damage, if there were any? I have quite a bit of experience in building construction. My background as a project manager has brought me into some crazy projects. I have limited exposure into fire damage, which is why I'm not diving right into it just yet.
We used our own labor for portion of the build (Full Disclosure we own a Contracting Company) and then out source the Roofing & HVAC. so we had a pretty good handle on our Cost (Both Soft Cost and Hard Cost). The only thing that could have gone side ways were the finishes (I.E. Electrical Fixtures, Plumbing Fixtures, Flooring) we were limited on the type of finishes so we kept them basic.
There is a tendency to try and install items that suits your taste, but might not be the same as your end buyer.
What I haven't shown you is the pictures of the inside, we were lucky and demo the complete inside down to the slab. The only thing left standing was the Perimeter Walls (Stucco and Wood Framing) so it was like doing a complete remodel.
Rental Property Investor · Irvine, CA · Member since 2015 · 18 posts · 5 votes
11y
That's good advice. I work with some interior designers that I would look to for advice on finishes and what is popular in the area. So you installed all new mechanicals and everything? You practically built a brand new house, minus walls and slab. How much of a pain was it pulling permits and working with inspectors? Are there generally alot more hoops to jump through with fire damage rebuilds?
as far as the permit go, in this case there were two.
Demo Permit
Addition/Construction
these two were separate, the second one was a little miss leading because we didn't add any addition but because it was a complete tear out we need a permit.
The Demo permit was easy because it was mostly just the roof that was coming down, the whole inside was completely damaged so everything was gutted.
The inspections weren't a problem at all, since the existing slab was there the only thing that got inspected where:
Framing
Roofing
HVAC, Electrical & Plumbing
Insulation
Drywall
and then off to the finish line to get Final Inspection.
Oh, the only issue was the Water Heater Straps that we forgot to install, so got us a ding.
Wholesaler · Holiday, FL · Member since 2013 · 571 posts · 221 votes
11y
Something that pretty much every fire-rehab-project has in common is: 1. the damage is greater than you can see, and 2. getting the smell permanently out can be a Monster Job.
Many contractors will only approach this on a 'remove everything burnt or porous' basis. Sealing can work but there is always a risk of residual evidence appearing later.
If the fire was confined to the attic it will be far easier and less invasive to deal with. If the fire was substantially in the living space I would make my very best detailed estimate of rehab-costs, and maybe add 10-15% - Justin Case. And then after I had a firm, every possible detail covered, cost firmly in hand - I would double it before proceeding.
Something which can be a real plus is installing a large fireplace or wood stove into the rehab project. Because people who smell anything later will attribute it to the wood burning appliance. And people who are looking at houses with fireplaces and/or wood stoves are the kind of people who find the smell of woodsmoke appealing.
I just recently came across a property that has extensive fire damage. Have not done a walkthrough yet. Did a drive by and the exterior is intact as is the roof. So it seems the fire was contained mainly to the first floor. Wondering what are some things to look for when I go walkthrough the property beyond just extent of cosmetic and structural damage.
Renting to college students seems like a perfect scenario. Even if there is a little smoke smell left when you are finished, they won't notice over the cigarette smell on their clothes. LOL
Thanks for the input. The wood stove idea could definitely work. Only thing I would be concerned about would be if a potential buyer has a prejudice against wood stoves in their rentals. I know alot of landlords that refuse to let tenants use them due to insurance liabilities.