Unless you’ve been hiding under a rock for the past 10 years (Why are you doing that? Let’s get you a house!), you know what house flipping is: an investor buys a house—typically one in need of some help—fixes it up (usually quickly, with generic finishes), and then resells it for a profit. Like it or not, this practice has been going on since the late 1980s. And while there’s an obvious appeal to buying a newly updated, turn-key home, there are some things you should have before buying a flipped house:

1. A Realtor®

This one is a gimme. 🙂 But c’mon—flipped home or not—why wouldn’t you want a skilled, knowledgeable ally in one of the biggest transactions you will ever undergo in your life?

2. An inspector who is not afraid to ask the tough questions

I always recommend all of my clients get a house inspection, but especially if the house looks like it’s been flipped. This may seem contradictory to a lot of people, (Why would it need an inspection? It was JUST renovated!) but I’ve seen a lot of house flips that were done so quickly that corners were cut to save time and money.

A good inspector will dig into the nitty gritty details of all the home’s most crucial systems: HVAC, electrical, plumbing, foundation, roof, etc. No stone goes unturned and no GFCI outlet goes untested. A good number of my clients have saved THOUSANDS of dollars by spending $400-500 to hire a thorough house inspector.

3. A list of completed renovations/updates

Buyers should never hesitate to ask the seller any questions about a house. After all, a house is an investment and a good investor should know what they are buying.

4. Research

Before buying a flipped home, it’s a good idea to try to look as deep as possible into who did the renovations and what was done. Go to the building department (or ask your real estate agent to!) and pull the permits that were filed for the renovations. Compare them against what you saw during your showing—do they line up? Look at the inspections that were done and see if any are still open. Permits are public record, so this is information that the developer knew someone could access. Since most people don’t, you just might come across something important.

You should also try to look into the developer and contractors as much as possible. It might give you some peace of mind to know if the developer who flipped your potential next home has done this hundreds of times already—or if this was their first. I would also highly suggest asking who the contractors were. A simple Google search might uncover some Better Business Bureau reviews that would give you an idea of how well (or not well) they do their job.

5. A home warranty

If you have any worries at all about the state of the home you are buying, a home warranty is a great way to supplement your home insurance coverage. Most people don’t know this, but your homeowner’s insurance does not cover things like appliances, water heaters, HVAC systems, plumbing or electrical systems.

If you’ve found a flipped home but aren’t sure whether it’s a solid investment or not, give me a call at 317-379-7720 or send me an email at courtney@locallivinggroup.com.