We have seen it time and time again. People getting deceived by sub-par updates and repairs when buying a flipped house.
The premise of flipping a house is simple: buy cheap, sell high. Sounds good right? Maybe for the flipper. But for the person buying the property (the flippie), this usually ends in a sick feeling down the road. A flipper is going to do everything in their power to maximize the return on their investment. Many times these are accomplished by making sub-par repairs and “upgrades” to the property. Don’t kid yourself, there is usually a reason the house was selling cheap in the first place and the reason is not always disclosed during the buy / sell process when purchasing one of these homes after it has been “refurbished” but once it is yours…well you know the rest.
In many instances, the home is purchased by a first time “flipper”. These flippers go into the project with the best of intentions but may or may not have the proper skills and/or experience to tie a bread bag, much less restore a home. Add in the daily responsibilities that they are already committed to and remodeling a house on top of that suddenly becomes overwhelming. This happens all the time. Of course at some point during the process, the flipper may find that the repairs to the home are way more than they ever anticipated or above their “pay grade”. In a nut shell – they are in over their head! Sitting in front of a TV watching as people flip houses all day long…and make a lot of money doing it…seems easy right? What is not conveyed during the TV show is the massive amount of work it takes. It appears as though the projects are completed in about two weeks, all condensed into about 30 minutes. This happens all the time.
At this point, someone with experience should be called in but that would take even more money off of the investment return to a project that has already gone on WAY too long! This is when they find out that expertise (in any field) does not come cheap but remember, doing it twice is usually way more expensive. This is a fact that is lost on many people and all the flipper can see is the potential profit dwindling away every time something new is uncovered. This leads to cut corners, a glossing over of the real problems and undisclosed “fixes”. Next thing you know, the flippers part-time handyman buddy has re-wired and re-plumbed the entire house. Oh yeah, he also jacked up the foundation, painted over all the rotten windows that were filled with Bondo and sprayed bleach on the mold with a garden sprayer. All for a couple a thousand dollars and it looks fantastic…from a distance. If a buyer complains I’ll just throw them a little money off the top – problem solved. Hmmmm.
Experienced “flippers” can be just as bad. They have learned all of the tricks of the trade and use them to great advantage. They have trades that work fast, cheap and keep their mouth shut when asked questions.
This shouldn’t be taken as the normal practice for ALL in this business. There are people out there that actually do good work and care about what they are putting out in the market place. Unfortunately, as in most cases, a few bad eggs give the industry as a whole a bad name.
I guess the point of this story (phew, finally!) is this: Do your due diligence when buying a home that has been flipped. Have trusted and respected inspectors and contractors go through it with a fine toothed comb. Yes, they may cost you money, but in the long run…they will save you money and you’ll be glad you did it!