How to Determine What Financial Freedom Means to You
By Christina El Moussa
Tarek and I have a lot of experience with older flip houses, and you’ve seen some of that in our show. In one episode we flipped an old Spanish-style house that looked like it was going to be really straightforward but almost ended up being a nightmare. With the rehabs we did on that property, we were able to make a profit on it, but things were a little bit tight and stressful for a minute there.
I’ve been thinking a lot about that experience and some of the other older houses that we’ve flipped (and the ones we’ve skipped on) lately. If you’re flipping a house that was build within the last 15-20 years, you usually don’t have a whole lot to worry about with updated codes, HVAC, and/or structural problems. With older houses, these might be just the beginning.
Of course, I’m not saying that you shouldn’t flip older houses. They can be really fun projects, and people love it when they’re updated correctly and have all of their old school charm with modern appliances and amenities. However, if you’re going to consider an older house, you really need to be on the lookout for a few really common problems that can be total deal breakers.
Does It Have Central Heating and Air Conditioning?
Central air is a pretty modern invention, and it’s one that you really need most places in the United States. If you live in northern California it might not be a big deal most of the year, but even where we live it can get really hot and uncomfortable without good A/C.
If the house doesn’t already have central heating and air conditioning, talk to your contractor about what it would take to make this update. Add it to your budget because you know your buyers are not going to want a house without it. And, if it already has central heating and air, you should also take a look at its heating and cooling units. If they’re older and on the way out, you’re going to need to replace them.
Plumbing and Electrical Issues
You’ve seen me and Tarek deal with re-piping a whole house before, and it’s not a pretty picture. This is an expensive project, and it’s one that you won’t usually run into on newer homes. Older houses, though, have older pipes, and that can be a big problem.
As far as the electrical systems go, though, you’re probably at about the same risk of having to rewire as you would be with a new house. Mostly, you just want to know if the old owners did any DIY wiring and what it will cost you to fix anything they messed up.
Insulation
Insulation is another big thing with older houses. Newer houses are really well insulated to make them more energy efficient, and your buyers aren’t going to want to pay out the nose every month on utilities because they can’t keep their house cool or warm. If the house has insulation you should be fine, but you should probably also look at updating your windows to avoid leaking heat or air out through them.
Always Take Your Contractor With You
Those are the big things to look for with older flip houses, but there are always things that you could miss. That’s why we always have one of our contractors or project managers meet us at our potential flips to go over them with us, especially when we’re looking at older houses. Just having an expert there to tell us what needs to be done has helped us avoid a lot of really bad deals over the years, and it can definitely save you time and money, too.
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Tarek and Christina El Moussa have over a decade of professional real estate experience and have been featured in national print publications, online media outlets, and a popular real estate reality TV show. Christina is known for her exceptional design and aesthetic talent.
Latest posts by Christina El Moussa (see all)
- How to Determine What Financial Freedom Means to You - July 1, 2016
- The Do’s and Don’ts of Working With Friends - June 27, 2016
- 4 Paint Colors to Avoid on a Flip - June 21, 2016
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