Finding houses to flip is the easy part. By now we assume you’ve purchased your first flip after carefully considering the estimates provided by the electrician, plumber, general contractor, termite service, and possibly landscaper. This lesson covers what to expect during the renovation, not the actual work. If you intend to do your own electrical work or plumbing, you’ll need technical expertise far beyond the scope of this lesson.
In order to perform any work on the home, you’ll probably need a building permit. Yes, we said probably, because building permits are not required in all towns and cities across the country. Most unincorporated towns have no governmental agencies, so you couldn’t obtain a building permit even if you had to. It’s up to you to know the requirements in your area. In most cases, obtaining a building permit is mandatory. If you’re working with a general contractor, he or she will often be able to obtain the permit for you.
Knowing your local and state laws is imperative. In some towns and cities you can’t do your own wiring or plumbing unless you’re licensed by the state. In most areas you can do the work yourself, but do you really want to? Remember this. If the house burns to the ground after you sell it and faulty wiring is determined to be the cause, you’ll probably be sued by the homeowners or their insurance company. If it’s legal to perform wiring or plumbing in your area, make damn sure you know what you’re doing. The building inspector will check out your work after it’s done, but one single misstep could cause a fire years down the road.
During the appraisal phase before you purchased the home, you should’ve decided what type of renovations, remodels, or upgrades you want done to the house. If the house was built in the 1960’s or 70’s you might be able to squeeze by with modernizing it. If the house was built more than 50 years ago, you might have to gut it down to the roof and four walls. If you’re performing minor cosmetic changes and simply modernizing the house, be prepared for the unexpected. Some homes still have aluminum wiring, which might not be legal in your area under today’s building regulations. If the electrician discovers aluminum wiring in one section of the house, you might get lucky and have to upgrade only that section. If the entire house has aluminum wiring, you’re looking a complete replacement of the electrical system.
When working with contractors or subcontractors, you’ll quickly learn that patience is a necessity. Materials might be delayed. The light fixtures you picked out last week might suddenly not be available this week. If it rains the roofing company won’t be able to work. Expect the unexpected, and never, ever try to estimate exactly when the house will be done because you’re anxious to flip it. The house will be done when it’s done. As this lesson was being prepared, a post on Facebook exemplified the risk of working with contractors. One of the national home improvements stores assured a couple in Tennessee that the installation of vinyl siding on their home would be performed on Monday. The crew arrived on Monday and allegedly worked the entire week. By Friday afternoon, only 10% of the home was sided. The couple had every right to complain about the slow installation, but no number of complaints will change the fact that having the siding installed will end up taking two weeks or more. Always assume the worst yet hope for the best.
If you’re attempting to flip a house without the assistance of a buyer’s agent or a realtor, you should pay particular attention to the septic system. In most states you need a state-approved permit for the septic system. if you purchase a 2-bedroom house and intend to convert the den into a third bedroom, check with the local building inspector first. Chances are the septic system was approved for two bedrooms. If you add a third bedroom you might have to apply for a new septic system permit. If that’s the case, you might need to install a larger septic system. The septic tank and leech field are designed to handle a certain volume of wastewater. Adding a third bedroom would technically increase the demand on the septic system by 50%. Don’t assume you can simply add an additional bedroom to a house without first checking the state and local requirements for the septic system.
One word of advice to those who cherish peace-of-mind. If you’re using contractors or subcontractors to renovate, remodel, or upgrade a house, stay away from the property while the professionals are working. If you want to check their progress, do it after the work crews have left for the day. If you’re already stressed over how long the renovation is taking, the last thing you need is to visit the house and find four workers taking naps in their trucks. If you enjoy peace-of-mind, you certainly don’t want to be at the house wondering why the plumbers are 15 minutes late. Leave the work up to the pros. If you’re not happy with a contractor’s work, call him or her at night or on the weekend. Arguing with a contractor in front of his crew on the job is never a good idea.