How to Identify a Good “Fixer Upper” Home

So, you’ve spotted a home that is in a state of disrepair. Maybe the property has been vacant for a number of months and it’s looking a bit neglected. But that’s okay because the neighborhood is perfect, the home is right across the street from a park and it’s in a prime school district. You’re thinking that you’ve hit the jackpot. Before signing on the dotted line, let’s take a minute to talk about identifying a good fixer upper.

Buying and flipping a home can be an exciting and extremely profitable venture. However, you have to assess your remodeling costs correctly in order to keep those profits high. In order to predict your total remodeling costs and plan an accurate budget, you’ll need to know as much about the ‘basics’ of the home as possible. This entails an honest look at the inside, outside, foundation, plumbing, electrical and attic conditions before handing over your money.

Just looking at the possible curb appeal, style of the home and location may cause you to miss structural problems that may need more work, time and money than you bargained for. The key to identifying a good fixer upper is to look with a critical eye. Keep searching for the hidden reason that this home hasn’t already sold and hopefully you’ll prove yourself wrong and have an excellent candidate for a flip on your hands.

Assuming you’ve already assessed the value of the neighborhood, here are steps that will help you focus on the infrastructure of the home and avoid surprises later.

Inspecting the Roof: Does the roof have an overall ‘wavy’ appearance? This is caused by water damage or too many layers of repair work. If shingles are moldy, this can be another sign of a damp, damaged roof. Do you see more than one layer of shingles? Building codes generally allow one additional layer. If you see more, there is probably an entire re-roof in the near future of this home.

Electrical Inspection: When looking at the meter base outside, does everything look fairly new and in good shape? Is there a fairly new air conditioning unit outside the home? Check the amps running to the home at the main circuit breaker. 200 amps is the best, but a home with electric heat should have a minimum of 150 amps. Check the utilities and wiring for cable, phone, etc.

This is also a good time to check the appliances inside the home. Does the kitchen have a garbage disposal, dish washer and all expected appliances? If so, do they work properly? Where are the washer and dryer located? Is there a proper outlet for the dryer? Check all the other outlets as well. The bathroom and kitchen outlets should be three pronged. If they aren’t, they will need to be upgraded.

Foundation and Structure: Does the house have wood siding or a wood frame? Most homes in Florida don’t, but if you run into an odd style or are considering a purchase in a historic neighborhood, you’ll need to consider extra inspections. Wood has the potential for termite damage and you’ll want to hire a professional inspector that knows how and where to look for signs of termite damage.

What is the foundation of the home? Brick foundations were used in some older homes. Look for loose areas and gaps, which allow rodents to enter. A concrete slab foundation can mean costly plumbing repairs if there is ever a plumbing issue.
Water Damage and Plumbing Inspection: While the plumbing is fresh on your mind, walk through the house and check all the ceilings and window areas for signs of water damage. Ceiling stains can be a sign of an AC unit that leaked or roof damage that allowed rain to enter the home.

Find out what the pipes are made out of. Copper piping doesn’t do well in Florida and has the tendency to leak. PVC is best. Check all the plumbing to be sure it works. Look under sinks and around tubs and toilets for signs of leaks or damage. How old does the water heater appear to be? Is there rust or corrosion near the bottom of the unit? The water heater should be 30-40 gallon capacity and easily accessible.

Attic Inspection: Check for insulation that is 7-8 inches deep. Take a flashlight and look at the underside of the roof sheeting. Are there signs of prior water damage, rotting or current leaks? Is there any bow to the rafters? How well ventilated is the attic?

These pointers should give you a realistic view of the condition of your fixer upper. These are not all-inclusive and more surprises may be found along the way. Use this list to keep your excitement in check when looking for a potential home to flip. It may be disappointing to discover that your ‘perfect flip’ turned out to be more work than you bargained for, but it’s better to find out what you are up against from the beginning so you can budget accordingly. Ideally, your perfect fixer upper will include cosmetic repairs, paint, yard work and minor repairs.  Anything else should be carefully considered and budgeted before making your final decision.