If you are taking a loan to buy the old and ugly house, getting insurance coverage is required before closing. Issues like whether the house has "knob & tube wiring; aluminum wiring or fuse boxes.", foundation, roof and water heater issues - can directly impact on willingness of underwriters to cover the house. I got my new build house rejected by the insurer because of "aluminium wiring". Had to scramble for another insurer last minute. So buying "ugly house" is not so straightforward and easy, cos insurers can ask very technical questions about the house conditions/materials used and can be extremely difficult. Normal home inspection report may not cover the questions of the insurers, probably need a certified electrician to give an inspection report too. Sellers usually go er...i dunno, do your own due diligence. So knowing what needs to be done to comply with building and safety codes means you need to have an idea of who you need to engage to deal with the anticipated issues.
Thank you for your comments @riverfish401! You seem like an experienced RE Investor. Thanks for taking those great steps. May I ask, in the end, after the scrambling to find a different insurer, did you manage to solve the issue? And was it a great deal in the end? In our humble opinion, its true that "ugly" houses comes with a set of problems (insurer/outdated mechanicals/wirings, etc), which turns away the masses, most that are not ready to solve the problems. This creates lesser competition, swaying the negotiation power to the buyers who are willing to go the extra mile to solve the problem. Allowing enterprising buyers to buy undervalued. Then it is up to the buyers to get educated, on how to solve these problems. If they can solve it at a fraction of the discount they get from bargaining, that's where wealth is being made. Each time they buy and solve a problem, they gain a skill. They will have acquired many skills as they grow their portfolio, those hard problems slowly become easy, or non-problem anymore. TL:DR, as repeated RE Investors who profits from solving problems, our goal is to get educated and be able to solve all these problems at a costs a fraction of the discount we get from negotiating.
If you are taking a loan to buy the old and ugly house, getting insurance coverage is required before closing. Issues like whether the house has "knob & tube wiring; aluminum wiring or fuse boxes.", foundation, roof and water heater issues - can directly impact on willingness of underwriters to cover the house. I got my new build house rejected by the insurer because of "aluminium wiring". Had to scramble for another insurer last minute. So buying "ugly house" is not so straightforward and easy, cos insurers can ask very technical questions about the house conditions/materials used and can be extremely difficult. Normal home inspection report may not cover the questions of the insurers, probably need a certified electrician to give an inspection report too. Sellers usually go er...i dunno, do your own due diligence. So knowing what needs to be done to comply with building and safety codes means you need to have an idea of who you need to engage to deal with the anticipated issues.
Thank you for your comments @riverfish401!
You seem like an experienced RE Investor. Thanks for taking those great steps.
May I ask, in the end, after the scrambling to find a different insurer, did you manage to solve the issue?
And was it a great deal in the end?
In our humble opinion, its true that "ugly" houses comes with a set of problems (insurer/outdated mechanicals/wirings, etc), which turns away the masses, most that are not ready to solve the problems.
This creates lesser competition, swaying the negotiation power to the buyers who are willing to go the extra mile to solve the problem. Allowing enterprising buyers to buy undervalued.
Then it is up to the buyers to get educated, on how to solve these problems. If they can solve it at a fraction of the discount they get from bargaining, that's where wealth is being made.
Each time they buy and solve a problem, they gain a skill.
They will have acquired many skills as they grow their portfolio, those hard problems slowly become easy, or non-problem anymore.
TL:DR, as repeated RE Investors who profits from solving problems, our goal is to get educated and be able to solve all these problems at a costs a fraction of the discount we get from negotiating.