You’ve done it. The foreclosed house you bought in the high-end neighborhood finally looks the part after some paint and some well-placed furniture. You’re staging your home to sell, and would-be buyers love the open floor plan, the potential, and the school district. Signs are pointing to a successful sale. Until the home inspection.
The house may look great cosmetically, but the home inspection can reveal serious structural or functional problems that make this piece of residential property unlivable and unsaleable. Suddenly, you’re back at square one.
When investing in real estate, it’s critical to understand the importance of a successful home inspection, and that it is not limited to the look of the home. Plumbing, electrical, HVAC — these all must pass the home inspection before a home is sold, and can be expensive for someone looking to flip a foreclosed or otherwise devalued property for a profit.
And that’s what it’s all about — profit. Property management can be a lucrative endeavor if all the proper steps are followed. According to Fortune magazine, 97% of all wealth was created or maintained through property. While money markets can fluctuate drastically, real estate are generally more stable. There is always a need for housing, so it can simply come down to knowing how to price your home.
While property managers and flippers can make good money selling their property outright, there is also the opportunity to develop consistent income through keeping it as rental property. More money can be saved through an array of tax deductible expenses available to property managers to lower taxes and free up cash.
With so much to be gained through buying, selling and owning residential real estate, the last thought cannot be the home inspection. Because the home inspection is a standard part of a sale, it may be in the property manager’s best interest to conduct an independent home inspection prior to listing the home. This will give the opportunity to address any issues that may delay or deny a possible sale before potential buyers walk in the door. These may prove to be the most costly aspects of flipping a real estate property, which is why a buyer of a foreclosed or devalued home should pay close attention to any home inspection done on the property before they buy it.
Remember, the buyers of your property are also making an investment, and, rightly so, will expect to get what they pay for. The home inspection is a way of protecting themselves from the things they can’t see, so it must be a high priority for the seller as well.