Red Flags When Buying a Flipped House

| Buying

Savvy investors can achieve miraculous results, transforming fixer-uppers into gems. Although those gems do exist in Toronto, you need to know how to spot the difference between a quick flip and a high-quality renovation.

Let’s make sure you find a gem! Here are the red flags to watch for when buying a flipped house.

Not All Flippers are Bad

There are a lot of savvy, honest flippers out there who want to make a buck, but not at the expense of the buyer. These flippers list the homes at a higher price because they have invested time and money to ensure their upgrades are up to code and use top-notch materials. There’s nothing wrong with purchasing these homes. In fact, these homes are dream finds well worth the investment.

Unfortunately, there are two types of flippers you need to look out for:

  1. Shady: Dishonest flippers driven by the almighty dollar purposefully use tricks that distract from serious issues. They know how to hide dangers from the average buyer and appeal to your emotions. Once you’re hooked, you happily agree to pass on the inspection, so you won’t miss the opportunity to snatch up this treasure. Not cool.
  2. Inexperienced: Honest investors lacking the experience and funds to invest in proper workmanship and materials make it easier to spot red flags—but not always. These flippers aren’t purposefully looking to mislead buyers. They just don’t know what they’re doing.

Inexperienced and shady flippers present equal risks, as it all boils down to shoddy workmanship. So how do you spot the gems from the nightmares? Read on.

Do you have other questions about buying or selling a home? Check out these posts next:

Red Flags in Flipped Houses

Here’s what we look for in a flipped house:

  • Low water pressure: Checking every faucet and flushing every toilet for water pressure, clogs, and smells is a must when buying a flipped house. When possible, we’d even go so far as to have someone watching the ceiling for signs of leaks in areas below toilets, tubs, and shower stalls just to be safe.
  • Dripping: Checking under the sinks for musty smells, dampness, and obvious drips is another important test for plumbing issues.
  • Lights: Test the lights to see if they flicker. You can also leave the lights on to see if the switch plates heat up. These are common signs something is up with the electrical.
  • Painted cabinets: While professionally painted cabinets are fine, shortcuts will lead to peeling, bubbling, and the need to sand and repaint the entire kitchen. Drips, unfinished cabinet backs, and paint that comes off with a quick fingernail test mean the paint wasn’t applied properly.
  • Suspicious paint jobs: Slight colour differences and shadowy spots on the ceiling tend to indicate past leaks.
  • Wonky cabinets and drawers: Old kitchen cabinets and drawers open and close less smoothly due to outdated hinges and hardware. This isn’t necessarily a bad thing, but it tells you the kitchen updates are purely cosmetic.
  • Cheap trim: An unpolished look to trim work indicates shoddy flips. Mismatched trim. Gaps along baseboards and floors. Crown moulding that lacks substance. You get the picture.
  • Flooring fails: Flooring is another place flippers cut corners, including poor-quality materials and DIY installation. Gaps, uneven floors, mismatched materials, random transitions, etc. are all signs of poor-quality flooring. Inconsistencies in the tone of hardwood floors can also mean the floors were poorly refinished.
  • Crappy appliances: If everything in the kitchen seems brand new, but the appliances look outdated, it could indicate the flippers had budget issues. Where else did they try to save money? We also met a character who would buy dirt cheap high-end kitchen appliances that didn’t work. The listing agent would write in an “as is condition” and the buyers would ultimately have to buy all new kitchen appliances. This is just one of the many horror stories we’ve encountered.

What happens if you do end up buying a badly flipped house? Can it be saved? Read our blog: How to Fix a Badly Flipped Home

A Buyer’s Protection Against Bad Flips

There are two real estate pros that protect you against scary flips:

1. Killer real estate team

Killer real estate teams like us do our homework. We also know Toronto neighbourhoods because that’s where we work. You need a real estate team to inform your decisions with the following information:

  • We know the area and will recognize a home that was recently on the market.
  • We check the history to understand the basics, including how many people owned the home, how long it took to sell, how much it sold for, and the current listing price.
  • We check for permits and inspection failures.

2. Spidey sensor house inspector

House inspectors have “Spidey senses” that track down the common red flags that lead to flip nightmares, including:

  • Shoddy plumbing and electrical work
  • Poor quality materials
  • Improper installation
  • Foundation and roof issues
  • Work not up to code
  • Water damage and moisture issues

Having the right team behind you is the sure-fire way to protect yourself against shady characters and inexperienced flippers. Get in touch today by calling us at 416.291.7372 or emailing us at hello@christinecowern.com.