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Old 02-08-2011, 08:13 PM   #1
lekparlroummabhw
 
Join Date: Jan 2011
Location: Gibraltar
Default What would you do with a free house?

his is the tip of the proverbial iceberg, one of my in-laws' houses. Nature is trying to take it back over, inside and out. That black hole in the center is where the front entrance is; a seven foot tunnel of vegetation pulling down the porch. The house was built in the mid-80s and is in an upper middle class neighborhood next to a middle school. (It's the haunted one with the crazy old man inside!) Problem is, he hasn't done repairs in literally years. Here's the short laundry list:

- looks like a shut-in lives there: stuff stacked to the ceiling
- three foot hole in roof gaping leaking into den
- misc. water stains on all ceilings
- all kitchen appliances broken
- only one upstairs toilet works (yes! it's TWO STORIES)
- disgusting floors, dog was never house trained (beyond cleaning)
- smells like mildew and mold due to undiscovered leak in kitchen
- backyard has so much growth you can't see the swimming pool from the back door

He's actually offered us the house (which is paid off; he lives in another house) for FREE on several occasions. We've politely declined, but in all likelyhood we're going to end up with it anyway as he is very old. My husband wants to just turn it over to the "Ugly House" people. I'm inclined to agree, but the thought of trying to flip the house has its merits.

What would you do with a free house of horrors? Is it worth the time and energy to try and flip the damn thing? Or just sell it as is and be rid of the whole mess?
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Old 02-08-2011, 08:13 PM   #2
Gemsspoon
 
Join Date: Jan 2011
Location: Greece
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Personally, I'd renovate and then flip. If the house is free and you spend, for example, 50k renovating then sell it for even just 100k, you've doubled your profit, whereas I can't really see you selling this house at all if it's really in the condition it seems to be in.
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Old 02-08-2011, 08:13 PM   #3
befenhate
 
Join Date: Jan 2011
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I'd say you're looking at something more like $60k for renovations, depending on where you are.

Roofs are not actually all that expensive. You'd probably have to have the entire house re-drywalled, Plumbing fixed. New floors/carpets, probably new appliances, cabinets, and hardware. Landscaping is an easy fix.

I don't know anything about the ugly house people, but I'm willing to bet they pay **** and they'll low ball the **** out of you and try to scare you into unloading for nothing.

There is a certain risk to taking on that much debt. Maybe your father-in-law can loan you the money to repair the house?
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Old 02-08-2011, 08:14 PM   #4
teethwhitnn
 
Join Date: Jan 2011
Location: USA
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If he were offering it to me, here's what I'd do.

1. Figure out what you'll have to pay in property taxes and insurance per year first to see if you can afford it.

2. Shut off the electric and water before something bad (or worse) happens.

3. Put a new roof on it ASAP to keep the inside dry.

4. Rent a big dumpster and gut the place. Get rid of any flooring/drywall/etc that has water damage, and toss any crap that was left behind.

5. Take a chainsaw to any growth that's close to the house to keep it from ripping up your new roof or the siding.

6. Now that you have a (somewhat) clean slate, you can fix it up over time as you can afford it. Once it's finished, sell it or rent it out. If things go south or you get sick of it, you'll most likely be able to find someone that will buy it as a fixer-upper.
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Old 02-08-2011, 08:14 PM   #5
smooroacimb
 
Join Date: Jan 2011
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If you are not a do-it-yourselfer, I would consider hiring a contractor. I inherited a house that had to be gutted and remodeled and it was a pain in the ass. The big problem is that for every problem you can see, there will be three more problems you can't see. Also because of this, don't take the contractor's estimate to heart, if he finds hidden problems you will have to pay to fix them. When I renovated that property years ago, we gutted the bathroom and discovered two things... first, the wall studs on one side of the house had rotted from water damage, I do not know what held that wall up. Second, the bathroom had been added on and there was asbestos siding inside the walls. You may not have those specific problems but you will have problems you can't see.
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Old 02-08-2011, 08:14 PM   #6
jassikahilton
 
Join Date: Mar 2008
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If you're looking to make money in improving houses, you want to take a ****ty house (which this looks like) and make it livable. You don't want to take a livable house and make it perfect, because people's ideas of perfect vary too much and diminishing returns is a lot more drastic.

Fix the roof, fix the floors, get a decent kitchen and bathroom in it, make sure the plumbing won't explode and the wiring won't accidentally burn the house down, and then sell it.

Honestly I'm piling on the finding good/reliable contractors rather than heavy DIY bandwagon. There can be all sorts of problems (you may lol at "killer mold" but it's out there) and having professionals is well worth the loss in profit. Before you commit to anything, though, you want to get the comparables and figure out two things:

1) how much you want to spend, keeping in mind what you're spending is what you're not making in profit

2) how long you want to take, keeping in mind seasonal fluctuations in the market plus average time on the market

The corollaries to these are that when you talk to contractors, any time a price is quoted, mentally assume it will take 50% more than that to actually get the job done, and any time a timeframe is quoted, mentally assume it will take 50% longer to actually get the job done.
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