Writer’s note: As part of my series of blogposts on real estate investment, I am going to write about evaluating the integrity of your prospective purchase. Perhaps the one biggest things that is overlooked by people making serious offers on an investment property is the 3rd party Professional Inspection.
There’s nothing quite like problems with your finances that will put a strain on your efforts at personal-development and self-improvement. A part of being successful in life is to learn from other people’s mistakes. I pity the person who continues to think they need to make every mistake on their own without consulting with an expert. Your time has to be more valuable if you are going to attain greater successful in this short dance in the sun.
The reasons I believe people usually not opt for these home inspections are they do not want to spend $500-700 on a professional inspection and subconsciously, they do not want to be proven wrong.
You finally found the right property! Right? You are ready to take all of your hard earned money and just launch it into outer space where the cosmic influences of the universe can take over, things just seem do right to you.
Granted, the bidding process and positioning your finances, working with your loan broker and your realtor, making counter offers and any other peculiar demands of the seller, all take time and energy, and then you feel like you just want to get the house.
It just “looks” right and has the amenities you are looking for, it’s in the right location so an and so forth. Why wouldn’t you want to get an inspection?
While an inspection cannot check everything, I would say 80%-90% of the problems that exist in a house can be evidenced through a professional inspection. They include assessments of the whole house, its various systems and inspections of the crawl spaces and pests conditions. Considering the nightmare problems I’ve witness from other buyers, you do not want to take the risk.
Spending $600 on a report could save you tens of thousands in unexpected repair costs, precious mental energy, and time.
Like in restoring classic cars, the work that takes the most money are the problems that are not obvious. In a house it could be rotting frames, extensive termite damage, old galvanized plumbing, broken asbestos, dangerously wired electrical systems, severely cracked foundations. Extra caution needs to be taken if part of the crawl space is inaccessible or remodeling has been done without a permit. Also, if a serious case of termites is discovered (meaning extensive bug highway systems with chunks of beams missing from hungry pests), the chances are they are also into the frames of the house that you cannot see, they can extend up into the walls and overhead also.
Who wants to be the owner of a house that collapses on their tenants? Not me.
House settling can also affect the plumbing geometry, causing unexpected plumbing back ups.
You will not believe the amount of kitchen remodel jobs that have been done without any attention to fixing rotten beams and floors. It’s stupefying.
It’s absolutely stupefying to think that a contractor could put a beautiful set of cabinets and countertops over a floor that could give way. The lesson is this, it does not matter how much something costs, every industry is confounded by people taking mind-boggling short cuts.
Just because a house looks good from the outside does not mean it have been done with integrity. For sure, if the previous owner treated the job as if it was his own home, more than likely, more care would be taken to do things with a longer term view in mind. The good house flippers will make sure that the structural work is taken care of and they can produce good workmanship at economical costs.
The problem with many (not all) who are flipping houses for a quick profit is, they are wanting to maximize their profits by not doing the extra integrity work and then take advantage of the people who are starving for a property and are loose with their money. And there are plenty of those. The vicious cycle continues.
The world turns… Do yourself a favor, get an inspection from a professional.
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I’ll see you… on the next page