Posted by BR2 on March 13, 1999 at 20:28:19:
Chuck,
Thank you sooooooo much for sharing your knowledge. Guess I’d better hit the yellow pages!!
Thanks again.
Water Damage/Busted Pipes - Posted by BR2
Posted by BR2 on March 13, 1999 at 18:25:44:
Just ran across a bank foreclosed home being sold by a realtor. I guess the tenants were evicted so they left the water running to get even. If I lived in the south it might not be so bad, but I live in Michigan. The hardwood floors have buckled and in some areas it runs the length of the home. In the basement there’s approximately 10 inches of water probably caused by busted pipes and clogged drains.
I’ve never run across this problem before. I was thinking this could run somewhere near 5k to repair which I don’t mind if I can get it at a good price.
Has anyone had any experience with busted pipes and buckled floors? I’ve rehabbed a few properties but never anything like this.
Comments/advice needed.
Re: Water Damage/Busted Pipes - Posted by Millie I.
Posted by Millie I. on March 14, 1999 at 02:13:52:
BR2,
I do not mind you emailing me, but I’d rather answer your email in a post to share with all.
First of all, if the FMV is $42K. Most houses are not sold at full value. So assuming that you managed to sell it for $38K, and your rehab is $15K, there is only $23K between purchase price and profit. You can only offer a maximum of $10K purchase price to yield $3K for carrying costs, and $10K profit.
But now, the seller is asking for $29K whether he is convinced that the house has major damage or not. Now what are the chances of him dropping the price from $29K to $10K ??? I’d say slim chance. Besides, that’s too much work for too little money. Professional rehabbers usually like to make a 100% on their investments (purchase price + rehab + carrying costs), so do I, but I don’t see it here.
I’d look for a better deal with less work and more profit, but that is my personal opinion, you decide for yourself.
Millie I.
Re: Water Damage/Busted Pipes - Posted by Millie I.
Posted by Millie I. on March 13, 1999 at 23:56:40:
BR2,
I live in Indiana. We have the same cold winter. I’ve had quiet a few incidents of cracked pipes in my years as an investor. They were never as bad as what you are looking at. I think your plumbing, floor replacment, and cleaning problems are gonna run way higher than $5K. Try $7K,$8K, or $10K, depends on how bad it is, and who is doing the work.
I would look at the situation carefully, order a building inspection to find out what you need to do, and how much. Then decide whether you want to buy this property at all.
Personally I’d walk. I like to make as much profit as possible doing as little work as possible. That way I spend less time and money on each property, make money faster, and move to the next deal quicker.
Decide for yourself,
Millie I.
This is kind of Funny - Posted by Jim IL
Posted by Jim IL on March 13, 1999 at 22:58:17:
BR2,
Thank you so much for posting this. Over the last two days my wife and I looked at several “Ugly” houses, and found 2 with this same problem.
They each had pipes burst, and buckled hardwood flooring.
Thankfully, the Realtors did get the standing water out, but did not correct the damage. (which should be good for us, since we are flipping them).
I had no idea about how to “Guesstimate” the repairs for this damage and came here to post about it.
Thanks, and if you get any more info, please pass it along. I will do the same,
Jim IL
Re: Water Damage/Busted Pipes - Posted by Chuck
Posted by Chuck on March 13, 1999 at 19:21:30:
Water can cause alot of damage as you can see. What can be even worse is the hidden damage. (mold growing inside wall. It can cause major health problems for people living there. You should have a qualified water damage company come take a look before buying the property. The longer the water sits in the house the more damage takes place. Even if a structure “looks” dry it may not be!
I am in the profession so I do have experience in water damage of this sort.
I also assume that the water was fresh water. If not you will have MAJOR expense cleaning it up and making the property habitable again.
Hope this helps.
Re: Water Damage/Busted Pipes - Posted by BR2
Posted by BR2 on March 14, 1999 at 09:34:36:
Thanks Millie,
I didn’t think anyone else would be interested in all the details and I didn’t want to use up ‘precious space’. Guess I wasn’t using my head. Anyway, thanks again. I think I’ll pass on this project.