For the past few decades, house flipping — that is, buying a home for cheap, renovating it, and selling it for profit — has been a major trend among developers and investors. In the early 00’s, it was commonplace for predatory flippers to take advantage of market conditions by adding minimal value to a property and raking in a huge profit. Many of those people are out of the practice now, since the housing bubble burst and profits are harder to come by, but it is still something to watch out for. So how can you avoid a bad house flip? Well, we’ve got some tips to keep you safe and happy in your new, old home!
Tip 1: Look for serious underlying issues.
Sometimes, serious problems can be hard to spot for a non-expert, like most of us are. Inspections are intended to zero in on this sort of thing, but wouldn’t it be nice to get out before you get that far in the process?
Foundation issues can be some of the most expensive fixes for a homeowner to face. As a result, a bad house flip is not going to address it, and may even take steps to actively hide it. Keep a careful eye on the warning signs; the link above has some great advice!
Another major problem is moisture. Structural damage, mold, electrical issues… yeah, no thanks. In addition to looking for rot and mold, pay attention to the property itself. Does the house sit at the bottom of a hill, where runoff will collect? If so, are there drainage systems in place? How high is the water table in your area? If you’re not sure about any of this, ask the seller!
Tip 2: Are the “upgrades” decent quality?
A bad house flip will usually replace old appliances and fixtures… but with what? Well, usually anything that looks nice and doesn’t cost much.
In the kitchen, you’re certain to find plenty of stainless steel: fridge, stove/oven, microwave, etc. The bathroom and light fixtures are probably brushed nickel, or at least something that looks like it. But these finishes, while popular and pleasantly neutral, aren’t necessarily signs of quality. You can put chrome on a Reliant Robin, but it’s still going to roll over.
Widely used economical fixtures and appliances are not a bad thing in themselves; there’s a reason they appear in most new construction. But make sure to check out the features and materials. Read up on specific models if you can. If that shiny, new oven only goes to 250° F and has a 1-star rating online, you’re probably looking at a bad flip.
Tip 3: Careless finishes mean careless work.
Choosing which work should be done, and what to do it with, is only half the job for a house flipper. The second half: competently installing and implementing the renovations. Even if an investor nails the former, a bad house flipper may skimp on the latter.
Elements like kitchen backsplashes, lighting fixtures, and stair railings are pretty easy to install for a practiced professional. They’re also easy to install badly for someone less professional. Holes can be cut too large or off center, and adhesive can be applied too liberally or not liberally enough. Are there gaps where there shouldn’t be? Screw holes left or painted over near where something is mounted? Did the painters simply cover loose debris without cleaning it up? (We’ve seen things like hair and bugs just sealed right to the wall. Gross.)
If these mostly cosmetic jobs were done carelessly, other, more arduous jobs probably were as well. These flags are redder than a stoplight, so buyer beware.
Tip 4: Did they clean up after themselves?
With the exception of properties still actively under construction/renovation, there should not be dirt, trash, or broken glass from a shattered front oven panel (yes, we’ve actually seen that) strewn about. Imagine you got a haircut that looks great from the front, but has a bunch of foils and product left in the back. It’s a safe bet that things aren’t great back there because the job wasn’t cleaned up. It’s the same with a house flip: if no one cleaned up once renovations were finished, they didn’t really care enough to do the whole job, did they? A conscientious investor will ensure that the finished product is immaculate so that they can maximize their return. Without those simple finishing touches, a bad flipper is content to take what they can get and move on.
Anyone can be bamboozled by a bad house flip. This is especially true if you’re a first-time buyer, or if you haven’t been in the market in a while. Swindlers, hucksters, con artists — whatever you want to call them, there are people out there who will take advantage of anyone who doesn’t know better. The best thing you can do is educate yourself on their tricks and tactics. If you’ve read this far, you’re already off to a good start!
You’ve got the knowledge (and knowing is, after all, half the battle), so get out there and buy something great!