Key things to look for during walkthrough?

Question

What are some of the most important things to consider when you are walking through a property? What are things you love to see, and things that are deal killers?

Steve Morris · Answer

"What are some of the most important things to consider when you are walking through a property? "

Bring your moisture meter for dry rot and outlet wiring tool (about $5 at Home Depot) to check proper wiring.

Use mositure meter around windows and kitchen bath floor / tub / shower.  Look at windows for blown seals.  Rock toilet with your knees (straddle it an move it side to side) to look for soft flooring.  Look in attic for mold and if ALL vents are hooked to outside roof vents.  Look around top edge of wall for moisture staining.  Look at plumbing to gauge what it is (PVC, CPVC, Galvanized, Copper).  Note age of water heater (15 years is normal life).

Kamil Baldyga · Answer

It depends slightly what investment strategy my client is using. Generally speaking, when I do a walk through of a potential buy and hold investment property, we get a general "feel" of the property as a whole and dive right into the big CAPEX items, roof and HVAC. If the roof is in good shape and it has architectural shingles, you can expect to save money upfront and potentially lower the percentage you save each month for CAPEX. Same thing with the HVAC, if its in good condition, or better yet, it's new, saves money upfront. A bad roof and HVAC don't rule out a property as a good investment as long as the numbers work.

Inside the property, I look at outlets (Three prong outlets are good, two prong could mean the electrical system is dated), possible water stains, water heater, and general layout of the home.

There's a plethora of other things to look at but I wouldn't say anything is a "deal breaker" so long as the problem can be addressed and the numbers still work. Sometimes "deal breakers" create a good investment property because it scares potential buyers away and the purchase price lowers. Learn how to address problems that other investors don't want to deal with. This gives you a strong edge when competing in the market. Hope this helps, let me know if you have any questions!

Nathan Gesner · Answer

That's a big question. I look for the biggest, most expensive problems: roof, foundation, heating and cooling, electrical, and then work my way down the list to the cosmetic.

Ujwal Velagapudi · Answer

Wow, all great tips! I usually left this to the inspectors, but it seems like an easy thing to add to a walk-through routine that can save time down the line. Definitely going to add this, need to be more astute about this aspect from the start.

I do touch on the major physical elements of course (roof, electrical, plumbing, hvac, cosmetics), but I know my inspectors can do a much better job. I tend to focus more on the intangibles like the seller, neighbors, tenants, why certain things are operating in such a manner, general city/neighborhood feel, etc. I have a chat with tenants, talk to neighbors, get lunch/dinner nearby, go walk to a store close by, etc.

Nathan Fisher · Answer

These are a little different then the great answers above

Things that stop me from buying: a house smell, being told the previous owner was a handyman

Things I love: Quirky details that set the place apart. I have one rental, with some outlandish linoleum flooring. Some tenants don't care for it, but those who love it, absolutely have to have the place! Find character when you can.

Reagan Huefner · Answer

@Kamil Baldyga love this idea! Might have to try it out. Thanks.

Steve Morris · Answer

"Wow, all great tips! I usually left this to the inspectors, but it seems like an easy thing to add to a walk-through routine that can save time down the line."

1) Follow the inspector and ask questions.  95% don't mind and you learn.

2) Most damage is moisture invasion.  It doesn't get cheaper the longer you wait, so you need to find it right away.

Kamil Baldyga · Answer

@Reagan Huefner We have one in the works however any checklist will vary slightly depending on how homes are built in that market. I would honestly recommend working with an agent in the area when looking to purchase a property. If you really want to get savy, see if any local home inspectors will let you do an "internship" or tag along with them when they inspect properties. Just be straight up and say you're an investor trying to learn more. Worst they can say is no, right? They are wizards when it comes to what to look for and what is and isn't a major issue.

Reagan Huefner · Answer

@Kamil Baldyga thank you for your response! Every house has a price that makes it a good deal right? Do you know of a good checklist for a buy and hold walk through?

Key things to look for during walkthrough?

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