To replace the roof or not to replace the roof

15 Replies

Hello all,

New to BiggerPockets here - and wanted to get some thoughts on whether or not to replace a roof during the rehab of a flip.  Comps in the neighborhood are around 150-170k.  Here's the issues with the roof:

1.  The roof is 19 years old and is showing some signs of wear on the shingles

2. There were 2 gable roof additions added where shingles were installed that don't quite match the existing shingles

3.  The ridge vent along the top of the roof leaks slightly in a few locations

4.  Gutters are in bad shape and no drip edge around perimeter.

So my options are to:

1.  Replace the roof - I got quoted around 4k

2.  Replace the ridge vent, fix gutters, drip edge, etc - quoted around 1.3k

3.  Do nothing

Again, just want some thoughts here on if you guys think the roof will be a deal breaker for people when buying the house, if i'll be able to recoup the cost of a new roof when selling, etc.  

Thanks in advance

I would replace it.  You have to disclose the leaks and other issues.  And of course an inspector will be all over this.  Rather than scare buyers away you can bolster your marketing by adding "new roof!".  Buyers do not want big issues (roof, foundation, major mechanicals).  $4k also sounds really cheap.  You might want to get another bid just to compare what you are getting.

Promotion
Sundae
Property Marketplace
Find Professionally Vetted Properties from Motivated Sellers
Eliminate the need to hunt for houses again. We bring your next investment opportunity to you.
Sign Up for Free

the buyers will most likely ask for the roof to be fixed in their repair request if they have a professional inspection done. In my personal opinion definitely do the roof

I really like Tony's sage advice to turn the weakness into a strength and marketing tool with a new roof...

You can also help improve the housing stock with making real capital improvements and not just cosmetic items In your flip, but that said, that roof is visibly a distraction with some patching.. 

So you get a two-for one , fixing a major system and adding some curb appeal. I would do 1 and 2. 

Make it right and get the venting and gutters renewed as well. You protect the asset and don't pass the buck.. 

From a risk management angle, you also protect your improvements inside (so roof first!) and guard against messing up your sale (where inspection may make you do this anyway or buyer may balk if there are leaks discovered in the inspection).. 

Finally, get a quality roofing firm and use an attractive mid grade shingle (at least) and even think some of the shingle color to compliment the brick and colors.. Best of luck

my opinion would be to replace the roof that way it is a known cost and it could increase the value. With the age of the roof and the mismatched shingles if I was a buyer, I'm going to ask for the roof when I write the offer, so your profit goes away at that point or worse your buyer goes away because the roof scared them off. 

From the information you provided I would go ahead and replace it. Im not sure what your profit margin is looking like on this, but $4k would be a pretty cheap cost in my market. Im typically looking at $6k on a roof replacement this size. When people are buying flips, they typically expect everything to be brand new. That premium you are getting disappears with some of the major components being at end of service life.

hi @Brady Alford , I'm with the others on this one, replace it. 

As to the question of being able to recoup your costs, that's a toss up.  Any buyers agents will inform their clients to reduce the price based on the inspectors comments of the roof.  If you have the $4k quote in writing, you could always provide this quote to negotiate with.  (example: Buyer says roof needs to be replaced so I'm dropping the offer by $6k.  You come in with, I'll drop $4k based on this written quote)  And then you don't have to deal with it. (scheduling, permits, inspections, etc)

But if you are trying to make a name for yourself as a professional flipper, you should replace it. 

$4k is really cheap to replace a roof, assuming they are stripping it. You want it stripped; don't let them go asphalt on asphalt. If they are stripping it I would definitely do it. If those are 20 year shingles, I would probably ask what the difference is for 30 year shingles. Not only do the architectural shingles look better, they sit heavier on the roof and are harder for storms to tear off. 

The question of replacing the roof should have been a factor in making a offer to purchase the property. When investing in flipping homes you do not decide as you go along. Generally there is a end price based on market and replacing the roof will have no effect on the sale price. Flippers can not expect to raise the sale price on a home to compensate for there cost overages. A new roof will make the sale easier it will not  likely be a cost you can recoup.

Roofs are one of the easiest items to assess in a flip prior to purchase.

I have found that it is best to replace the roof when in doubt.  This is one item that even if wholetaling or wholesaling it pays a greater than 1X increase in value.  A bad roof makes a lot a potential fix and flip buyers hesitate, so if buying and then flipping it out, get the roof and any structural items done and the money will come back to you.  Find good roofer and foundation people in your area and give them all of your business in order to get a great deal on their services. 

A good roofing contractor will even give you leads on properties where they have gone out and given someone a bid and then they said they could not afford it.  He gives us the lead and then we followup and if we get the deal, he gets the roof.  Same for foundations.

A good roof is about like new carpet - makes the deal with less hassle in the sale process.

Good luck.

I have found that it is best to replace the roof when in doubt.  This is one item that even if wholetaling or wholesaling it pays a greater than 1X increase in value.  A bad roof makes a lot a potential fix and flip buyers hesitate, so if buying and then flipping it out, get the roof and any structural items done and the money will come back to you.  Find good roofer and foundation people in your area and give them all of your business in order to get a great deal on their services. 

A good roofing contractor will even give you leads on properties where they have gone out and given someone a bid and then they said they could not afford it.  He gives us the lead and then we followup and if we get the deal, he gets the roof.  Same for foundations.

A good roof is about like new carpet - makes the deal with less hassle in the sale process.

Good luck.

Promotion
REI Nation
Turnkey Real Estate
Wondering how to safely invest in out-of-state real estate?
This 40-page eBook is your best resource for safe, profitable, passive real estate investing.
Download Now