If you are considering buying a flipped house… make sure that you have a home inspection contingency included in your offer.
Unfortunately, here in the always-active Vienna real estate market, a flipped house is often the only affordable option in the average price ranges. If you aren’t familiar with the term, a flipped house is property bought by an investor who makes updates and plans to re-sell the home quickly… typically withing six months.
You and your agent may not have much time to inspect a hot new listing before submitting an offer. So, here is a checklist that can help you grasp the quality of the workmanship.
Inspect a Flipped House
- Windows ~ Take a look and see how old they are. If they aren’t new, open and close them to see if they stay open, have screens, and note if there is fogging between the two panes of glass.
- Furnace or HVAC System ~ Note how old it is, and what type of system it is… forced air, hot water, natural gas, oil, or a heat pump. (see below for additions)
- Bathrooms ~ Was the tub or shower replaced? Check on the tile, drainage, glass door. Open the drawers on the vanity, check the water pressure, was the toilet replaced?
- Hot Water Heater ~ How old is it? The reality is that most manufacturers of hot water heaters feel 6 years is old, but don’t let that upset you. I recently saw a flip with a 25+-year-old hot water heater (YIKES!) If there was an addition, the water heater must be less than two years old.
- Roof ~ I can typically tell clients fairly accurate the age when I see a roof, but on this one you’ll need to ask the seller. A roof can last 25 years, and you should know now if it is twenty-years-old already.
- Flooring ~ Many older homes in Vienna still have “suspect tiles” which may have asbestos. These take about a day for an environmental company to remove and certify (about $3,000). Oak flooring can always be sanded and refinished, and carpets can be replaced.
- Modifications ~ Some flippers remove walls to create the “open-concept” feel you see every time you watch HGTV. Removing walls is a HUGE modification, and know it can be done right easily by an experienced contractor. You should not assume anything and ask for documentation like engineering plans, designs, permits, or photos.
- Additions ~ Popping-the-top of a house can double the square footage, and add a luxury bedroom, bath, laundry room, three bedrooms and much more. I did this to my Vienna rambler and know a lot about it… and have things I would have done differently. Additions always require permits so make sure you see them because there was electrical work done, plumbing and structural additions. That 8″ steel I-beam is now carrying 2x the load!
- Electrical Panel ~ I’m talking about the circuit breaker box. If the panel box is old, then it may not be big enough if there was an addition (look for a sub-panel) to carry the load. Power is important so you want to make sure there isn’t rust in the panel, double taps, or signs of any electrical arcing.
- Sewer Lateral ~ Ask your home inspector if they can inspect the sewer lateral with a camera, or schedule someone who can. Especially on flips, the previous owner may have been 87 years-old and taken a shower three times a week, and run the dishwasher only when it was full. Your family of four may take daily showers, do laundry, run the dishwasher, and flush the toilet 12 times a day… and that is much more flow to the sewer main. Most flippers won’t replace the sewer lateral.
- Kitchen ~ Open all the drawers to see how they glide (or not) and examine the quality. Touch the counter tops and make sure seams are smooth. Is there a vent hood… does it go outside. Examine the age of the appliances and the brands, are they dented? Is it electric or gas cooking. Is there a microwave, pantry, under cabinet lights, or a backsplash?
- Chimney ~ Note if it is wood burning or a natural gas chimney. Natural Gas logs typically indicate that the chimney has been inspected and is functional. Wood burning fireplaces need to be looked at closely especially when significant use is apparent in the fire box.
- Decks ~ Some home flippers use a special deck paint to conceal age. Go under the deck and see what the underside looks like, if it is original, or if some boards have been replaced. Note the railings since some 1960’s homes have slats big enough for a kid to run through.
There are plenty of nice homes that pop up that are remodeled with a high level of quality.
There was an inspection recently that caught me off guard. My client had been the runner-up on a flip and the agent called me the next week saying the buyer was backing out. Now, they had outbid my client and possibly got cold feet (no one wants to pay too much) and the agent called to see if we were still interested.
But, during the home inspection, there were just too many things that either not done right or were just low quality. So, the contract was declared void and my client walked away.
It was a bummer, but that’s why I always include a Home Inspection Contingency especially to thoroughly inspect a flipped house.
Have questions? Send me an email and I’ll share some insight with you.