When flippers get it wrong… you inherit the problem.
When home prices start rising double digits per year, it doesn’t take long for enterprising home flippers to enter the market. Most have no experience in home construction or remodeling beyond watching YouTube or HGTV.
Home flippers rely upon cosmetics and market appreciation to net a profit on their flip. Many find unanticipated and expensive repairs after purchasing the home mostly due to their lack of due diligence or knowledge of home construction. Few flippers are prepared to deal with unknown repair costs, so they tend to patch rather than repair or replace.
Most homebuyers buy location, curb appeal, and finishes while overlooking possible problems with plumbing, HVAC, electric, windows, siding, and roofs. That is the primary reason people hire a home inspector, but they often fail to understand the type of home inspector they need for a flip home.
The Downfalls of a Flip
Most home flippers are not exactly forthright in disclosing hidden or concealed conditions and the law supports them as they “have not lived in the home”; in other words, they may claim they were unaware of the problem. Often, flippers do not hire qualified trade contractors to perform needed work, and even more often, they fail to pull building permits or obtain building inspections. They swap components, patch holes/leaks, and cover materials with paint. Remember, the home is sold “As-Is” so once you close, the flipper is done.
We have seen some massive problems in flip homes which could have easily destroyed our clients’ finances with unknown repair costs. Frankly, we have provided second opinion inspections for many buyers when their home inspector failed to recognize hidden issues. Home inspectors, like all occupations, are not all equal.
If you are buying a flip home, you really need to hire the most qualified and experienced home inspector you can find and preferably, one who is also a Licensed General Contractor with a background in home construction/remodeling. Simply, they will know the danger signals an inexperienced inspector may overlook.