I don’t think anyone can give you that answer as no one but you knows the extent of the damage. Can it be repaired? Will it need to be pulled down? Even if you do manage to repair the damage, will the place still stink of smoke? Is the plumbing ok?
I think to find out what you need to offer, you need to get several contractors in to price up the repair work, and then take it from there. You may also need to take into account that you may need to pay with your own cash for the repairs as you may have a difficulty getting a loan and even if you do, you may need to make payments while the work is being carried out.
Whatever you pay, it needs to be at a heavy discount to make it worth while.
I have an opportunity to make an offer on a burned 2br/2ba house that was bringing a lease of 700.00 per month and the owner says to make her an offer. Houses in the neighborhood have sold for 66,700-78,000. I have never done a rehab so what type of offer should I make. She says a lady is bringing her an offer tonight so I would like to make one first if I know how to do so.
Re: Burned House Help Please! - Posted by Sakar Kawle
Posted by Sakar Kawle on October 29, 2003 at 07:17:38:
Well, well, well - I’m in the process of doing a burnt rehab now. I suggest that do a little diligent research before making an offer. Remember you’ll have to replace all the electrical if the fire has spread to couple of rooms. I would say electricians will charge you close to $2500 for putting the service and re-wiring the house will be another $4000. So calculate $6k just for electrical. Also, in this event you’ll expose the walls so factor-in some of that additional expense.
Plumbing - If you had copper or PVC plumbing then definitely, you’ll have to replace them. If it is cast iron, you might be ok (assuming it has not got rust all over the place). A good way to test that out would be run the shower and the sink faucets, if the water is real low on shower then you are in to replace all the plumbing.
Windows - If the fireman (when they came out) has not blown away the windows then you might be ok. But if they have and you have to replace them, calculate close to $200/window.
I would ask the local housing authorities (local inspector for that area/block) also if they have something BAD against the house in their books - so that might be of help to know in advance. Pull permits for electrical, framing and anything else that is major - since you will need to get this house inspected before you get ‘certificate of occupancy’.
Although, I also do not know the extent of fire damage, but I would advise that your hold cost will be little higher, just because of inspections that you have to go thru.
So, factor in all this and you might be fine. Also, if you do not have contractors to do the work and you end up calling people for every other thing that needs fixed - then just stay away from this. This type of rehab is probably for little experienced people. But hey, if you wanna take a chance and have room (and $$$) to absorb little frustrations this rehab will teach you a lot of things.
Just do not buy very high, so that you end up spending a whole lot on this and kill your profit. You can negotiate using the points mentioned above against the seller to get you price real down. Also, do not do anything stupid to beat other people. Just my 2c’s.
Re: Burned House Help Please! - Posted by RichV(FL)
Posted by RichV(FL) on October 28, 2003 at 19:10:44:
Marye,
If you dont have experience with rehabs and have no idea what to offer stay away from this one. Brent is correct. Educate yourself in this business before you jump in.
Learn your market place and what things cost to fix.
You may want to start with cosmetic rehabs (carpet, paint, fixtures, etc).
They are a better start for someone new rather than a fire damaged property.
Re: Burned House Help Please! - Posted by Brent_IL
Posted by Brent_IL on October 28, 2003 at 16:58:40:
If you have never done a rehab, and don’t know what to offer, skip this one. Inexperienced rehabbers are like pools of minnows. The more experienced sharks eat well at their expense. Take time to learn how the biz works, then start making offers.