Problem & Condemned Properties
A condemned house might sound like the exact opposite of an investment opportunity, but these properties can be ideal purchases if the circumstances are right. They have unique advantages and disadvantages as investments, so don’t rush to buy one in what looks like a nice neighbourhood just yet. Consult with Investment Property Guru Matthew Scott first and get the best advice before taking on a condemned or problem property!
Condemned Vs. Problem Properties: What’s The Difference?
There are some major differences between problem and condemned properties. A condemned property is one that the government has taken over from a private owner when it has been deemed abandoned or unsafe. The buyer will have to make changes to bring the property into compliance with the municipal codes and by-laws. When it has successfully passed inspection, it can have its condemned status lifted.
A condemned property is usually given its label when the home breaks down to an unsafe and unliveable degree. There are other factors that can lead to condemnation:
- • The home has been vacant for a long period of time; in London, the process begins after a home has been vacant for 30 days.
- • A home inspector discovers problems that make the house unsafe to live in.
- • The utilities to the home have been discontinued.
Whatever the reason, you’ll usually find these properties at a steep discount. If the signs point to the market heating up around where they are located, you could find an incredible investment opportunity. Bringing a condemned or problem property up to code, however, could take a lot out of your budget. They could need any or all of the following, especially if they’ve been in disrepair for a long time:
- • Plumbing
- • Heating and cooling
- • Hot water
- • Lighting
- • Ventilation
- • Updated electrical
But some homes, while in a state of disrepair, aren’t condemned by the city. These are known as problem properties, and they can have a negative impact on the otherwise nice communities. A problem property is one that has had multiple complaints against it for different bylaw infractions. Most often, this is because the owners do not take care of it. It will be in better shape than a condemned property, but it will still need work to bring the property up to code and make it liveable for another family.
Schedule a Consultation
Talk with Matthew Scott about whether you think an opportunity is right for your budget. He can help you determine whether a local condemned or problem property is right for your house-flipping plans!