I own a house?

[Heismanberg]

I don't think I'd gamble with foundation problems.  If this is your first house, I'd avoid the temptation to gamble. Any house you buy is going to have some problems when you get it inspected.  Nothing wrong with taking on a fixer upper, but a foundation issue is a different animal. Foundation issues can be anything from a few grand to "oh excrement we have to rebuild the whole thing, hand over your wallet".  I can't really give any advice on location.  Perhaps there's locations that are somewhere in between.

My Dad had to spend about $20K on his mother's house to fix a unlevel foundation from a huge oak tree root.  Had to jack up the whole corner of the house to be repaired.  I inherited the same house and had to spend another $7K because it settled again in several places. I feel I was lucky it was only that much.

One we're looking at specifically has an estimate of $19K for repairs with steel piers (no idea what the hell that means) with a lifetime warranty after repair, but resettlement is the biggest concern because that jacks up the walls, doors, and floors. 

Even blowing around $20K to fix it places it about $80-$90K under what it's worth without any other sprucing up.  That's why it's enticing.

I doubt we'll buy in this neighborhood, but I'm keeping a close eye on what's happening around it.  I was able to get a lot of paperwork and inspection information on three houses and I've sent them to a good friend of mine that's a structural engineer.  He should be able to let me know his thoughts today.

[Heismanberg]

Foundation issues are the grand poobah of red flags when purchasing a house.  Honestly, i would steer clear.

It's a major issue, but the property itself has insane value.  I could most likely make at least $50K on the lot in less than a year. 

[bojanglesman]

One we're looking at specifically has an estimate of $19K for repairs with steel piers (no idea what the hell that means) with a lifetime warranty after repair, but resettlement is the biggest concern because that jacks up the walls, doors, and floors. 

Even blowing around $20K to fix it places it about $80-$90K under what it's worth without any other sprucing up.  That's why it's enticing.

I doubt we'll buy in this neighborhood, but I'm keeping a close eye on what's happening around it.  I was able to get a lot of paperwork and inspection information on three houses and I've sent them to a good friend of mine that's a structural engineer.  He should be able to let me know his thoughts today.

Good idea with the structural engineer.  That's the go-to person.

[MBGreen]

It's a major issue, but the property itself has insane value.  I could most likely make at least $50K on the lot in less than a year. 

If you go through with this, you'll need to pray that the foundation issue doesn't cascade into other issues with the house. That 50k could get swallowed up pretty fast.


Consulting with a structural engineer was smart.

[Heismanberg]

If you go through with this, you'll need to pray that the foundation issue doesn't cascade into other issues with the house. That 50k could get swallowed up pretty fast.

If there's serious issues where I'd have to spend more than the $20K, we'd likely demo it and sell the lot. 

Wouldn't go through with purchasing it unless the steel piers can fix it.

[bojanglesman]

If there's serious issues where I'd have to spend more than the $20K, we'd likely demo it and sell the lot. 

Wouldn't go through with purchasing it unless the steel piers can fix it.

Would you come out ahead after paying to demo it? 

[Heismanberg]

Would you come out ahead after paying to demo it? 

Almost certainly. 

I could likely get one of these houses with a lowball offer for well under $200K and the lots on surrounding streets are selling for $300K plus because everyone wants to live in this area.

[Libero_2]

Almost certainly. 

I could likely get one of these houses with a lowball offer for well under $200K and the lots on surrounding streets are selling for $300K plus because everyone wants to live in this area.

It sounds like this isn't your home you want, but one you want to make money on.

If that's the case, the gamble is clearly worth it, IF you have a fully inspected home, and trust the hell out of the structural engineer (I would get multiple people to assess, but that's just me). If you can make 50-100K it will be worth it. If you have that type of wiggle room, when accounting for 20k (I would probably double the highest estimates to be safe when planning, if it comes out better than that, all the more money too you) then I think it's probably worth it.

It would enable you to get a huge head start financially on your life, and put you in a much better home in/around the area you want to live for at least the foreseeable future. If you feel you can clear 50+ thousand accounting for double the financial headaches, I would go for it, but I would drastically overestimate the amount of money you expect to pay in fixing things. If it actually sticks to estimates, you will be well off, but if it doesn't, and a worst case, or near worst case scenario happens, then you are still in a space you feel comfortable working in.

[Heismanberg]

It sounds like this isn't your home you want, but one you want to make money on.

Ideally, we'd like to live there for a few years and let the area around us appreciate as much as possible.  But the investment opportunity is there in multiple ways, worst case scenario is demo.

[bojanglesman]

If you can flip things so easily, why are so many properties available?  Seems like real estate investors would have beat you to it.

[Johnny English]

One we're looking at specifically has an estimate of $19K for repairs with steel piers (no idea what the hell that means)

I'm not an expert on foundations but I believe that steel piers are generally more expensive and better than concrete. They're essentially the same thing, long columns mounted beneath the foundations to support the house, but with steel they go all the way to the bedrock so once they're in you don't have to worry about it ever subsiding again. MB's point about insurance is a sound one though, even with the piers installed I don't know if a lot of insurance companies will want to know and if you can't insure it then most mortgagees won't be interested.

[Johnny English]

If you can flip things so easily, why are so many properties available?  Seems like real estate investors would have beat you to it.

Not sure that extensive foundation work or demo and rebuild constitutes an easy flip. Investors tend to want projects with known costs and timelines, and which are easy to resell quickly.

[Heismanberg]

If you can flip things so easily, why are so many properties available?  Seems like real estate investors would have beat you to it.

Lots of them are selling 48-72 hours after hitting the market.  Mostly to investors for what seems like cash.

Normal home buyers likely aren't being approved for most loans because a lot of the homes aren't considered structurally sound.

[SixFeetDeep]

I removed, re-wired, and installed a new light fixture today. Without dying.

[MBGreen]

I removed, re-wired, and installed a new light fixture today. Without dying.

I replaced my doorbell yesterday. The first thing I did afterward was call my dad to tell him I’m not useless.

#smallvictories