Pesky questions to ask when searching for investment property
Got a crumbling or severely cracked foundation wall needing extensive foundation repair? Ever wonder how to tackle an investment property with this problem? Will it be too large a project to tackle because of the concrete slab cost? What will the overall foundation repair cost end up being? How do I estimate the correct costs for any foundation crack repair? And ultimately, is the investment property worth the overall renovation cost when the foundation is in bad shape?
Most investment properties, whether they be house flips or longer-term rental building holdings, will require some amount of fix up work to be done to them when you acquire them…In the end, the decision whether to acquire the property hinges on your ability to finance the renovations along with the overall purchase price. Can the purchase price plus renovation costs (plus carrying costs too) enable you to make a decent return on investment after you purchase the building?
The property inspection report
In figuring out basement repair costs, make sure you have a licensed property inspection company do a thorough inspection of the entire property, and submit their report to you. The report should detail any inherent basement problems, including foundation cracks or even more severe foundation issues. I have acquired a property that needed the entire foundation be dug up and rebuilt. The house had to be jacked up a little bit at a time, one side at a time, in order to gain access to do the repairs. There also was a great amount of excavation work required as well in this undertaking. Was it expensive? You bet! It cost close to twenty thousand dollars to lay in a new foundation. But it was a property I knew I’d be holding for a long time, and the numbers worked out for my model – and the extremely low purchase price I was getting the property for made the deal worthwhile…
Easy fixes vs. large renovations
Sometimes foundation crack repair work can be easy and relatively inexpensive fixes. They may only costs in the hundreds of dollars to re-mortar small, benign cracks. Other times, entire excavations of one side of the building are needed to get at the root problem of the crack, and repair it. If your engineering report shows a problem with a foundation, make sure you obtain several price quotes to effectuate the repair. Or, if you’ve been working with one general contractor for a very long time, and he is already an integral part of your team, then feel free to trust his cost estimates on the repair.
Get to work fast…
Once you close on the property, be sure to start work immediately on fixing the problem. The longer you wait, the longer the problem will get exacerbated, and the bigger the overall repair cost will be to fix it. Make sure these repairs are done in accordance with your local building department code. In addition, make sure to time the repairs to coincide with your other major renovations to the building. This will help ensure the greatest economies of scale for your project, as well as make sure that only one large scale mess is created in one time period, and not spread out over a large period of time.
photos courtesy of foundationrepairdallas.com, douglasfoundationrepair.com, hdfoundationrepair.com, media.merchantcircle.com