Lipstick on a Pig – Understanding the Dangers of Rehabbed Foreclosures
With millions of homes having been lost to foreclosure and millions more to come, savvy “investors” may purchase some of the best deals with the intention of turning them for a quick profit. Unfortunately, some of those “investors” have little knowledge of construction and use their skills as “make-up artists” to put lipstick on what might otherwise be seen as a pig, a home with serious or even dangerous defects.
Homes that have gone through the foreclosure process have often been neglected by owners who lack the financial resources to do routine maintenance. Other homes may have been vandalized or had appliances, plumbing fixtures, wiring or plumbing pipes stolen. And while the investor may replace missing fixtures and make repairs, in some cases those making repairs lack the proper licenses or certifications required by local building authorities. Unscrupulous “flippers” may even attempt to cover up obvious flaws or dangerous conditions.
Homebuyers considering the purchase of a home that has gone through foreclosure should always seek the guidance of an experienced real estate agent and should ALWAYS have the home inspected by a qualified home inspector. While homes that are being “flipped” for profit may have lots of “sex appeal,” buyers must look beyond the surface. Applying makeup cannot solve serious defects; and if there are unanswered questions or concerns it may be better to skip the flip.
To see some of the dangers posed by “flips,” and unscrupulous “flippers,” read these two posts from Jay Markanich, an experienced home inspector in Bristow, VA:
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Shoddy worksmanship - slipshot repairs by unskilled, unlicensed help. This is just the beginning for some of the more recent rehabs. Always have these properties inspected by a professional and due yourself some 'due diligence' and check with the village authorities about recent permits.
Don't get me wrong, not all rehabs are bad but not all rehabs are good either. Just watch out for that 'lipstick on pig'.
Great post from John Mulkey.