SHOULD YOU BUY a "FLIPPED" HOUSE?
Have you personally ever considered and wondered if you, yourself should BUY a "flipped house."
In my 15+ years of predominantly residential Central Austin brokerage practice and experience, here are my insights, opinions, suggestions and things to be cognizant of.
#1. Absolutely, for sure get a LICENSED INSPECTION on the flipped house!
Not all flippers are the same. Just like in life there is a wide spectrum in regards to quality. Some flippers are flat out awful. They make very lipstick-like improvements, skip the expensive items such as the foundation, and plumbing and try to trick the consumer into paying more for a home, when the consumer shouldn't.
On the Flip Side (this joke was just too obvious) There are also excellent high-quality flippers whom selectively choose which homes they flip, and then they invest carefully and beautifully while genuinely improving a home! Some of these hi-quality upper tier flippers embrace and love their craft and shine as home improvement experts.
#2. Recognize FLIPPERS are trying make some sort of profit $$.
It's America and an attempt a Capitalism. As a consumer, ask your Licensed Buyer's Broker/Realtor representation to perform a thorough SALE HISTORY of the subjected flipped property. How Much did the FLIPPERS themselves pay for the home? Is this the first time this home has been flipped? How much more $$ is the asking price for this home in comparison to how much the flippers paid for it? Does the quality of home improvements match the asking price? Is this Flipped Home too expensive for the neighborhood?
#3. As a consumer, What is your advantage in buying a flipped house?
Positive, Pro's and Benefits on Why a Consumer should purchase a flipped home.
---Time. Buying a turn-key, excellent improved condition primary Home saves you the consumer, time, energy, efforts and contractor work, headaches, permits, etc. It's done, you just buy it and move in! You've already got a job, adding a second job title as home improvement contractor can be too much.
--Money $$ Sometimes when a consumer purchases a poor to medium level condition fixer upper home, the home may eventually or immediately need expensive $$ improvements, such as a new Roof $12K-$15K, Slab Foundation work 5K-25K etc, Electrical work $$, etc. After your Buy and Close, these home improvement expenses can often NOT be financed and require cold hard cash up front.
4. Things to be careful for, in considering a "Flipped House."
Did the flippers do a complete job? What items did the flippers forget to improve? Was it the electrical, the roof, the foundation, the siding, the landscaping? Usually flippers just select VISUAL improvements to the home, to lure potential buyers into closing on it. Again make sure you pay for a licensed INSPECTOR and any other contractor specialists your inspector recommends. Also ask your buyer's broker, are we paying too much for this $$ flipped house? Your buyer's broker will able to perform a CMA and research sold comps, price per foot, etc on your behalf. It's okay as a consumer to pay a fair retail appraised price, but try not to OVERPAY for a fixed-up flipped home.
How else can I work and help your Central Texas and Austin, Texas Real Estate Life?
Contact me directly.
George Vance McGee
Austin Silent Market
Licensed Broker Associate
512.657.9281
georgevance@gmail.com
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