Determining cost/damage of water before making offer?

7 Replies

I went to look at a property this morning that is owned by a close friend of mine. He seems to have neglected the property for the last 7 years and is looking to get out of the real estate business. The gutters haven't been cleaned in 5 years, so there's one gutter that has detached from the house in the front, and the overflow has rotten the deck in the back. In the attic, the water looks to have gotten through the siding onto the flashing and basically it crumbled/fell onto the attic floor after being saturated...but the siding is still there, but there's just no foil flashing. There's no indication of water damage inside the house/ceiling, but I'm worried about damage that an untrained eye can't see...like wooden beams rotting.

I'm trying to figure out how to go about estimating the cost so that I can make an offer on the property, but I don't really know what the extent of the damage is without having a professional take a look. Who would you recommend that I hire to consult/take a look at something like this before going and making an offer? My friend is worried that if I hire someone to go take a look and he finds something...and I don't buy the property, he'd have to disclose it to anyone who comes along and wants to buy it as-is? Is that true?

Could really use some advice on this one...and maybe that advice is to stay away and let someone who is more experienced take on the deal, which is fine, but I'm looking for any guidance that I can get.

@Roshan Taheri it all depends on the price of the house and what you can sell it for and how much you need to spend on other repairs.

It’s always best to get a professional GC that has extensive experience with these types of houses and situations. They will be able to give you an idea of potential damage and cost to fix. No one will guarantee a price but they can give you somewhat of an idea of way to expect worst case.

@Greg Dickerson so I think the property could sell for $240,000 after it is repaired and the friend said he would like $220,000. I was planning on offering whatever price I could afford to get an appropriate return on investment given the repairs that are required. The problem is that the repairs required for the water damage seem like they could have a really wide range of cost associated with them...so would I just contact a general contractor to come out and look/give an estimate?

Unless the seller is ok with getting a lot less than 220k, I don’t see how this flip would work well for you, even if the water damage was minor.

Originally posted by @Kris L. :

Unless the seller is ok with getting a lot less than 220k, I don’t see how this flip would work well for you, even if the water damage was minor.

Yeah, I wasn't planning on making an offer at 220K, I just need to figure out a ballpark estimate of costs to see if he's willing to accept a number that makes more sense given the damage. 

Originally posted by @Roshan Taheri :

@Greg Dickerson so I think the property could sell for $240,000 after it is repaired and the friend said he would like $220,000. I was planning on offering whatever price I could afford to get an appropriate return on investment given the repairs that are required. The problem is that the repairs required for the water damage seem like they could have a really wide range of cost associated with them...so would I just contact a general contractor to come out and look/give an estimate?

There's no money in the deal if you pay $220k and the ARV is only $240k after repairs and commissions you will lose money. Take a pass on this one

Yeah, we talked about it a little more and I essentially told him that even though its more stressful and a more difficult path, he should take the project on so that he doesn't have to sell as-is. I'm going to try and help him with some of the work instead.