Ask the Builder: Flipping houses isn’t the cakewalk you see on TV

DEAR TIM: I’ve decided it’s time to take a chance and flip a house that was built in the 1890s. I’ve watched plenty of shows on cable TV and feel it can’t be that hard. Have you ever done this type of construction work? What did you experience, and would you do it again? Are there unknown dangers, and how risky do you feel it is? It seems like it’s an easy way to make a sizable profit. – Paul T., Erlanger, Kentucky

DEAR PAUL: The first few years of my construction career were spent cutting my teeth, fingers, arms and legs rehabbing houses. Back years ago, that was the word used to describe what you’re thinking about doing. I could talk to you for hours about the challenges that lie ahead of you on this quest.

Let’s talk about the cable TV shows. I’ve been doing professional home improvement video work for more than 20 years. Most of the shows I’ve seen about flipping homes are produced as entertainment and are not tutorials or investment guides. The shows are taped and edited so you feel happy after you watch them. The show producer wants you to watch a following episode.

There’s an old saying that I feel comes into play here: “A half-truth is a whole lie.” If a cable TV show about flipping houses told you the entire truth and revealed all that really happened from the start until the end of the project, you might end up with a sour taste in your mouth. But if a show woos you with lots of glamour shots and the exciting aspects of the construction, you might turn off the TV, stretch your arms and get up from the couch feeling empowered and confident.

Flipping houses is hard, dirty, dangerous and risky work. It’s not unicorns, rainbows, juice boxes and fruit roll-ups. You might have better odds making a profit roaming through the Bellagio casino placing bets every 10 minutes at different $100 blackjack tables. This is especially true if you’ve got no real construction experience and you’ve never put together a detailed cost estimate for a project of this magnitude.

Indulge me in a trip down memory lane to give you a small taste of what may lie ahead in your flipping career.

Old houses, especially those build prior to 1967, contain vast amounts of lead paint. This is a given for houses built in the late 1800s and early 1900s. Any painted surface you disturb can create lead dust that can poison you or anyone working with the material. I had no idea about lead poisoning decades ago while I tore out plaster, sanded old paint and created clouds of dust while I wore cheap fabric breathing masks that were next to useless.

I’ll never forget the house I built for Habitat for Humanity. Fortunately, my money was not at risk, just eight hours of my time every Saturday for several months. It was the first house built on an old inner city lot in Cincinnati.

When we dug for the new foundation, we discovered a massive sub-basement where the original house stood and it took 200 cubic yards of flash fill to provide enough solid support for the new house footers. The budget was blown for this job before we drove the first nail.

I’ll never forget the shock I felt at another old house when I opened up a wall to install a new window. I saw all these tiny white insects about the size of a grain of rice scurrying around. Lo and behold, I was interrupting an extended family feast hosted by a giant nest of termites.

Oh, and then there was the first old house I flipped for myself. I decided to replace the rotten cast-iron plumbing drain lines with new PVC plastic ones. Once I had the entire system put back together, I couldn’t understand why the toilet didn’t flush right. It turns out that 80 years of scale and rust buildup at the bottom of the full-sized cast-iron vent stack was blocking air from getting into the plumbing system.

As I write this column now, I’m less than 10 miles from where you live. A few days ago I was touring a very vibrant community in Cincinnati called the East End. It’s filled with old houses and small businesses that were built at the same time, or slightly before, the house you’re looking at.

Many of these structures are currently being pushed off their foundations by a massive landslide. The landslides you see on the news in California grab all the attention because they’re violent and come down the mountainsides like an avalanche of snow.

These Cincinnati landslides are not new. I was a geology student at the University of Cincinnati and had the good fortune to study the characteristics of the bedrock geology of the greater Cincinnati area. The hillsides around Cincinnati and the bottom of the hillsides in the river valleys are prone to landslides.

In Cincinnati, the unstable soil created when the weak shale in the Kope Formation weathers moves like a sniper in a ghillie suit crawling through the weeds. Because the movement is slow, many in the community are complacent. On my recent visit I saw tilted foundation walls, patio stones bulging up as the soil oozes upwards, and entire structures pushed off their foundation walls.

Can you imagine what it might cost to stop or repair damage like this? If a lender discovers this is happening during construction or afterward, will he call the note and request that you pay in full your 30-year loan amount immediately? Will you be able to get new financing? Will you have to declare bankruptcy?

Vandalism, thievery of building materials and tools, and tough code restrictions will challenge you as you jump into this project. Out-of-level floors, ancient sewer and water lines that may have reached the end of their useful lives and other money-sucking surprises await you. Just be sure you can handle delays, cost overruns and lots of stress.

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