Foundation Issues, Are They Worth The Trouble?

Does anyone have any experience rehabbing a property with foundation issues? Is it difficult to find a buyer after the foundation has been fixed as part of a rehab? I know that buyers avoid foundation issues like the plague but if it has been fixed, with a transferable warranty, is there still a problem?

In particular, I found a prop that has been on the market for 6+ months, orginally asked 160k, down to 130k, and still no bites. The issue is the foundation. What would be the potential if I low balled it at 115k, fixed the foundation, along with other cosmetic stuff, and sold ~150k, or so? Is it worth it?

iglooman

Comments(5)

  • sacramentophil23rd August, 2003

    If you bought it at $115K and sold it at $150K, and subtract a realtor's commission, closing costs, and holding costs, that leaves you with about $15K profit, minus what you spend on rehabbing. Is there any profit in this property?

  • jchester23rd August, 2003

    iglooman... depending on the size of the property and location (i'm assuming Plano/Greater Dallas)... 1600 sq/ft (avg)...You're probably looking at 10k+! Also, make sure you know who you're hiring to do the JOB! I know of atleast 5 homes that got crooked.... I mean that literally, their houses are STILL crooked.
    so, do a little checking around...

    Hope that helps!

  • Bruce25th August, 2003

    Hey,

    Maybe I am stupid, but I don't see what difference it makes as to what the repair is.

    The formula you use to determine if you buy it is the same:
    Total Money In + Minimum Profit <=Selling Price.

    If it works, the repairs can be a new kitchen or roof or foundation.

    You have to get good qualtity workers, no matter what you are doing to the house.

  • MrsMeltzer25th August, 2003

    Most repairs are easily fixed. Paint, carpet, plumbing, electrical, roof, etc.

    Foundation problems are NOT easily fixed (and VERY expensive).

    I personally stay away from homes with foundation problems after being burned once.

    Hope This Helps!

    Mrs. Meltzer

  • NC_Yank25th August, 2003

    See if the seller (or you if need be) will come out of pocket with a structural engineer report....your probably looking at $250 - $500.00 for a report.

    Then you both will know what your looking at....

    Good Luck

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