Many people say that real estate investing is one of the safer things that you can do with your money. There is always a risk element involved, but that will be true of all investments unless you just take your money and stick it in a savings account.
You might choose to buy some houses and flip them. That often involves getting distressed properties in up-and-coming areas, fixing them up, and unloading them for a profit. It’s definitely possible to do if you have the capital and the initiative.
If you’re looking at some potential investment properties, though, there are some particular features on which you’ll want to focus. If these house aspects are in excellent condition, then that’s good news for you. If they’re problematic, then you might want to pass on that property.
The HVAC System
If you’re not familiar with the term “HVAC,” it stands for heating, ventilation, and air conditioning. Basically, you’re talking about:
- The furnace
- The ductwork running through the house
- A central air unit, if there is one
This is one of the first areas where a buyer looks when they’re considering whether a house is for them or not. If part of the HVAC system, like the furnace, is in bad shape, then they might pass on the house for that reason alone.
You might not completely shy away from a house with HVAC issues. You can price the repairs and contact an HVAC parts supply store if that’s all that is wrong with the place.
The Roof
Whether you plan on buying a house to live in yourself, you’re going to flip it, or you want to hold onto it and rent it out, the roof is certainly another area where you’ll want to take a hard look before making any decisions. You’re looking at:
- How old the roof is
- Whether any shingles are missing or loose
- Whether there are any notable drainage issues
Generally, a roof will last you about 10-15 years. That time might be shorter or longer depending on the weather at the property’s location. If there’s heavy rainfall or very tough winters, that will damage a roof and reduce the time till you need to replace or repair it.
If you need to replace a roof, they call that a total tear-off. It can easily cost you from $5K to $10K for more basic jobs, or even more if it’s a larger house, upwards of 2,000 square feet.
The Foundation
Another place you’ll want your inspector to look is the foundation. Just like a roof in poor condition, foundation problems can be extremely costly to repair.
If your inspector sees foundation cracks, you’ll need to look into the issue a little further. Cracks mean foundational instability, and many buyers will rightly avoid houses where that’s happening.
You might have water pooling beneath the house. A sinkhole might open up, and part of the house can slip into it. The property might buckle in the middle, damage amounting to thousands of dollars.
Where you see foundation cracks if your inspector says it’s going to cost a boatload to repair the damage, that’s probably not an appropriate property to flip. If you notice something like that, it’s time to move on.
Bathrooms
You’ll also want to look at the bathrooms. How many of them are there, and what’s their condition?
Some first-time homebuyers won’t even bother to look at a house unless it has two full bathrooms. The term “full bathroom” means a bathroom that comes with a shower or bathtub as well as a toilet. “Half bath” means just the toilet, with no shower or tub.
People like to have at least two bathrooms, if possible. There are some who might be shopping in a lower price range who will go for a single bathroom, or one full and one half, but be aware that you will have lost some potential buyers from just this one crucial detail.
Kitchen
People also often look for big kitchens. The bigger and roomier the kitchen, the easier they can envision themselves in there, cooking up a sumptuous feast for their guests on Thanksgiving. Whether they ever do that or not doesn’t really matter: they just want to imagine it when they’re looking the place over.
If you see an ancient roof, foundation cracks, or a tiny kitchen, it might not be the property for you to flip, unless you’re willing to sink some significant money into it.
