The exhilaration of being “yes” for all types of real estate transactions is the ultimate height.you wholesaleConnecting juicy deals, rehab, or renting, is never old.
Then inevitable things happen: you start to get into your ditch, money starts to flow, and one of your deals goes to you a poltergeist (wait a minute, more Halloween mentions from now on) there is).
In the spirit of the holiday, cover the most horrifying things you can do. And if you start any volume, it will probably happen to you someday. Below is a real horror story from an investor I know of. Veterinarian … I hope you read your scary story in the comments!
1) The house burns down
One of the investors I worked for was to rehabilitate a house on the west side of the town. He was watching the news when the latest story of a house fire happened. He recognized the area and thought, “Wow, it’s pretty close to one of my rental properties.” When I watched the on-site broadcast for another moment, he realized that it was his rental.
Fire trucks, news coverage, and studded houses. This is the kind of PR that most investors don’t want.
Fortunately, no one was there and he had enough insurance, but still burning one of your property is a nightmare in itself.
2) Mold problem
This is not Millmold’s “condensation of the upper ceiling of the bathroom”. This is a type of mold that “has been annoying you ever after Freddy Krueger thought.”
A friend of my other investor here in Arizona, like many others, decided to successfully rehabilitate here and seize opportunities in other parts of the country. (This story is probably hostile to optimistic articles about out-of-state investment). He and his partner were planning to buy some properties in Idaho and sell them for a large profit.
I got a call. No, no, the phone didn’t come from inside the house. It came from a neighbor who was interested in a sheet of ice coming from under the front yard door where their children were playing.
Another call from Johnny Investor to a property management company (also known as “Stupid Property Manager Alive” or SPMA) has begun a horrifying series of events. After explaining the situation, SPMA deeply apologized for not overwintering the house. (Really? In Aidaho? Did this happen to anyone?)
To “better” the problem, SPMA went to the property to investigate further. The house was flooded with water because the pipe broke. To hide her footprints, her next great step was to raise the heater to 86 degrees and try to “thaw” the house. (I couldn’t make this).
In doing so, she created one of the worst mold problems she could imagine alone. The orange dripping mold narrows the sides of the cabinet and connects the ceiling fan with a string. Overall shining effect … but there is mold.
The most unlucky party in the situation? Insurance company. To $ 168,000. Hopefully, “Susie Stupidest Property Manager Alive” was fired and joined the dumb undead. This is probably a better role for her level of intelligence.
3) Hiding monsters
They can be dormant and are just waiting to be cursed to eat up your profit margins with their ugly heads back. I’ve heard that investors were unaware that there was an underground storage tank and were forced to repair it. Fortunately, they got a house at a big discount and sold it, but it was broken. But you know there’s nothing to get your hair up after your next rise, and months of hard work and tens of thousands of dollars all heading for selling a home for free.
This can also occur in the form of major plumbing issues, horrifying foundation issues, or other issues that you didn’t know until you “drilled” into the property.
If you are buying from an auction, site hidden, or other similar situation, it may take hours or even days, if not hours or minutes, to inspect a property, often a utility. Will not turn on.
But like many scary movies, bad things happen in cruel ways. What is the conclusion? Don’t buy with a narrow margin, and really, really … Get good insurance.
(Cue “Thriller” laughs …)
What about you? What are some of the worst campfire horror stories for one of your deals, or anyone else you know?