There are many things to consider when buying a flipped home. First let’s answer – what is a flipped home? A flipped home is one that has been purchased, gone through renovations and/or remodeling, and is then listed for sale for a much higher price than what it was purchased for. In many cases flipped homes are purchased by investors who are looking to buy a home well below market value, fix it up, and sell it quickly for a profit.
As a buyer, there are many things that should be taken into consideration when buying a “flipped” home.
1. Check for Permits
Was an addition added to the home? A fence? Build a deck or patio? These are renovations that normally would require a permit or certificate of compliance. Contact the local city ordinance where the flipped home is located to find out what permits or certificates of compliance are on file. If there are any on file, ask when they were obtained. If there are items which require a permit and the “flipper” doesn’t have one, ask them to provide it!
2. Research the Prior Condition
Knowing the condition of the flipped home prior to the flip can be very helpful. A home that is vacant for a substantial amount of time can lead to a lot of problems. The utilities maybe turned off in vacant homes. Did the pipes burst? If there is moisture present in a home, did mold grow? Would an investor paint over mold instead of having it correctly re-mediated? Finding out what the condition was prior to the flip can also help determine what upgrades and work was completed.
3. Have an Inspection
Inspections are optional but are very valuable. A flipped home is usually never occupied by the “flipper,” therefore they are unlikely to know about any defects or problems within a home. It is very likely that when the “flipper” purchased the home, they did not have any inspections.
4. Research the “Flipper”
A “flipper” is someone who purchases a home well below market value with hopes of “fixing” up the home and selling for a profit. Every “flipper’s” quality of work is going to be different. When buying a flipped home, research the “flipper!” Find out if this is their first home they’ve flipped. Research the “flipper” just like any professional, service, and/or product should be researched.
A flipped home can be a very good purchase for a buyer. Like any home though, it can also be a very poor purchase. It is important for a buyer or their real estate agent to “do their homework.” The above are just a few extra considerations that need to be taken into account when purchasing a flipped home.
At Title Junction, we care about helping you stay informed throughout your real estate transaction. The experts at our title company have extensive knowledge about real estate not only in Cape Coral and Fort Myers, but all of Florida as well.
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