WHAT? Spend $69 Property Report on a $80K House? ARE YOU CRAZY?​​​​‌‍​‍​‍‌‍‌​‍‌‍‍‌‌‍‌‌‍‍‌‌‍‍​‍​‍​‍‍​‍​‍‌​‌‍​‌‌‍‍‌‍‍‌‌‌​‌‍‌​‍‍‌‍‍‌‌‍​‍​‍​‍​​‍​‍‌‍‍​‌​‍‌‍‌‌‌‍‌‍​‍​‍​‍‍​‍​‍‌‍‍​‌‌​‌‌​‌​​‌​​‍‍​‍​‍‌​​‌​‍‌‍‌​​‌‍‌‌‌​‍‌‌​‌‍‌‌‍​‌‍‌‌‌‍‍‌​​‍‌‌‍​‌‍‌‌​​‍‍‌​‌‍​‌‌‍‍‌‍‍‌‌‌​‌‍‌​‍‍‌​‌‌​‌‌‌‌‍‌​‌‍‍‌‌‍​‍‌‍‍‌‌‍‍‌‌​‌‍‌‌‌‍‍‌‌​​‍‌‍‌‌‌‍‌​‌‍‍‌‌‌​​‍‌‍‌‌‍‌‍‌​‌‍‌‌​‌‌​​‌​‍‌‍‌‌‌​‌‍‌‌‌‍‍‌‌​‌‍​‌‌‌​‌‍‍‌‌‍‌‍‍​‍‌‍‍‌‌‍‌​​‌‌​​‌‍‌‍‌​‌‍​‌‍​‌‌​‌‌​​‍‌​‍​​​‌​​​​‌​‌‍​​‍​​​‌‍​‌‌‍​‍‌‍​‍​‍‌​​‍​‌​​​‌​​‌​‌​‌‍​‌​‌‌​‍​​‍​​​​​‌‌‌‍​​‍​​‌​​‌​​‍​‌‌‌‍​‍​​‌‌‍‌​​​​​‍‌‌​‌‍‌‌​​‌‍‌‌​‌‌​​‌‍‌‍‌​‌‍​‌‍​‌‌​‌‌​​‍‌​​‌‍​‌‌‌​‌‍‍​​‌‌‌​‌‍‍‌‌‌​‌‍​‌‍‌‌​‌‍​‍‌‍​‌‌​‌‍‌‌‌‌‌‌‌​‍‌‍​​‌‌‍‍​‌‌​‌‌​‌​​‌​​‍‌‌​​‌​​‌​‍‌‌​​‍‌​‌‍​‍‌‌​​‍‌​‌‍‌​​‌​‍‌‍‌​​‌‍‌‌‌​‍‌‌​‌‍‌‌‍​‌‍‌‌‌‍‍‌​​‍‌‌‍​‌‍‌‌​​‍‍‌​‌‍​‌‌‍‍‌‍‍‌‌‌​‌‍‌​‍‍‌​‌‌​‌‌‌‌‍‌​‌‍‍‌‌‍​‍‌‍‌‍‍‌‌‍‌​​‌‌​​‌‍‌‍‌​‌‍​‌‍​‌‌​‌‌​​‍‌​‍​​​‌​​​​‌​‌‍​​‍​​​‌‍​‌‌‍​‍‌‍​‍​‍‌​​‍​‌​​​‌​​‌​‌​‌‍​‌​‌‌​‍​​‍​​​​​‌‌‌‍​​‍​​‌​​‌​​‍​‌‌‌‍​‍​​‌‌‍‌​​​​​‍‌‍‌‌​‌‍‌‌​​‌‍‌‌​‌‌​​‌‍‌‍‌​‌‍​‌‍​‌‌​‌‌​​‍‌‍‌​​‌‍​‌‌‌​‌‍‍​​‌‌‌​‌‍‍‌‌‌​‌‍​‌‍‌‌​‍‌‍‌​​‌‍‌‌‌​‍‌​‌​​‌‍‌‌‌‍​‌‌​‌‍‍‌‌‌‍‌‍‌‌​‌‌​​‌‌‌‌‍​‍‌‍​‌‍‍‌‌​‌‍‍​‌‍‌‌‌‍‌​​‍​‍‌‌

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Watch Episode 27

Transcript

Bob Frady (00:01.165)
Ladies and gentlemen, boys and girls, ships at sea, welcome to another episode of Property of the Week with Property Lens. For those of you who don't know who we are, I'm Bob Frady, co-founder and CEO of Property Lens, and with me as always is...

John - PropertyLens (00:19.936)
John Sigman, co-founder and president of Property Lens.

Bob Frady (00:23.31)
I thought we'd do something a little bit different today.

John - PropertyLens (00:27.25)
Okay, what?

Bob Frady (00:28.494)
I wanted to see what it looks like if we go to a cheaper house rather than the fancy dana states we always look at to see whether it's worth spending $69 to find out what's going on with a place that might cost less than $100,000. What do you think?

John - PropertyLens (00:48.874)
Wow, I think less than 100,000, you could probably put that on your Amex card.

Bob Frady (00:55.434)
all you know what you're probably getting yourself right to delta sky elite or or diamond platinum if you can manage to do that for easy payments of twenty four thousand nine hundred ninety nine dollars each for those of you with a twenty five thousand dollar limit and there's your real estate commission all all eaten up i'll take that myself thank you so here's what we did

I was thinking about St. Louis for some reason. I'm not sure why, but I was thinking about St. Louis. Maybe I had a rib fixation and I thought, well, let's go see what's in St. Louis. And I go to the front screen of realtor.com and up pops a house on 1201 Northdale Avenue in St. Louis, Missouri for $79,900. And I thought,

John - PropertyLens (01:41.664)
Sweet.

Bob Frady (01:42.574)
Well, let's take a look at what we got to see if there's anything in there. Why would you spend $69 on a house that only costs $89,000 or $79,000? Well, let's find out, shall we?

John - PropertyLens (01:56.746)
yes you know essentially you're asking why would somebody spend one one thousandth the price of their house on a report

Bob Frady (02:03.053)
Exactly. So here we go 1201 Northdale Avenue in st. Louis, Missouri. Let's take a look at that report and see what it tells us

John - PropertyLens (02:06.623)
Sorry.

John - PropertyLens (02:11.881)
Nice looking house.

Bob Frady (02:16.205)
Okay, so four beds one bath 73 years old 1500 square feet two tenths of an anchor moderately affected in prior damage, so John Give me the highlights of this property

John - PropertyLens (02:33.163)
Alright, well, looking at it, 15 possible damaging events. Come on, St. Louis, it's got tornadoes, it's got hail, it's got straight-line winds, it's got lightning. It's, you know, it's also oddly very close to a very large fault system, the new Madrid Fault. So there's stuff to experience here and you ought to know about it. Five known building permits.

So, you know, somebody's been doing something to it. The four owners in the last 15 years might be a little concerning at some pretty high turnover, but this is a starter house with only one bathroom. So there might be just, hey, we get in, we do something, and we move on to the next house. We're not seeing any updates to major systems. So, you know, it could have some major renovation needs.

But the repair costs are relatively low, $4,000 a year for the next couple of years. Tax increases, you know, pretty much at national average per year, and insurance actually a little bit below national average. So the rates must be set fairly well, and St. Louis, they know what they're getting themselves into.

Bob Frady (03:52.119)
then what are the highs and lows?

John - PropertyLens (03:55.318)
highs, fire protection, it's not going to get flooded, roof's in good shape, it's got good public utilities, and the city itself is actually ready for natural disasters. They're very well prepared to handle them, as well as low risk for some of the big ones. The property condition on the low side, it's a fixer-upper.

Don't be too surprised by that. Not in the safest of neighborhoods. A hail we talked about. It does get warm in St. Louis. And there seems to be a size discrepancy between what the county assessor says, what the MLS says, or possibly even what the replacement cost is being estimated off of.

Bob Frady (04:44.714)
You know, so this is not a system replacement, this is a system rebuilding. You you're down to the stud, you're need to put these systems in. So this $79,000 house is an opportunity for someone to play fixer-upper, but it is also in need of lot of repairs.

Good news, it's near some major highways, low risk for hurricanes, wildfires and landslides on Tree Line Street and Central Electric.

This two year repair cost is a little bit misleading because it is down to the studs. So you're gonna spend money on walls, you're gonna spend money on fixtures, the kind of stuff that we don't measure. And your annual insurance premium is about 1600 bucks a year, which is about 150 bucks a month, I think, maybe 140. So it's a significant amount of money that you're gonna be paying for insurance relative to the cost of the property itself.

So here's what the some of the questions to ask, know, how much is this gonna cost to update? You know, what's the how about the structural integrity with the lack of a basement? Why the discrepancy? between what the assessor says and what the MLS says Got anything to met mitigate the heat and you're pretty close to some toxic release facilities as well to me I Yep

John - PropertyLens (06:11.947)
My biggest concern with these would be the lack of a basement and not necessarily affecting structural integrity because lots of homes are built on slab. You live in California, you're always built on slab. But you are in an area that is known to have tornadoes and you have nowhere to go.

Bob Frady (06:32.671)
Yeah, yep, where you going in a tornado? So let's look at some of the estimates. Our two year repair estimates are gonna be on the higher side rather than the lower side. It looks like the HVAC system electrical systems and water heat has recently been updated, but all the other stuff, it's down to the studs.

John - PropertyLens (06:37.269)
you

Bob Frady (06:56.509)
So, and we don't have a rebuild the walls estimate here. So you're probably gonna end up on the higher end, more towards the $50,000 range, then to the estimated range, which would be about $9,000.

John - PropertyLens (07:08.841)
But one of the, I guess, nice things, there's only one bathroom. So bathroom and kitchen, your plumbing is, your piping and your plumbing, relatively limited.

Bob Frady (07:22.443)
Okay, here's what we see from a key finding standpoint on the buyer lens. Extreme heat, of course, at St. Louis, it gets a lot of that. But also in the wintertime, it's at risk of ice dams. And what do we do to guard against ice dams, John Sigmund?

John - PropertyLens (07:39.933)
We put on our gutter guards. Abs of fresh relief.

Bob Frady (07:41.951)
That's right, that's right. High risk of hail events and then below average walkability. So you're not necessarily taking the bus everywhere you need to go. Lots of questions that you can ask.

high risk of toxic exposure. can't even say that without getting tongue tied. So if you have high risk of PFAS contamination in drinking water, what do you do?

John - PropertyLens (08:13.523)
You get your water tested and see if you need a filtration filter system for the house.

Bob Frady (08:16.05)
Exactly.

Very good. John, you're doing 100 % so far. You got a higher risk for crime. What do do?

John - PropertyLens (08:25.885)
alarm system and cameras.

Bob Frady (08:28.916)
Correct, and potentially even greats on the Windows.

John - PropertyLens (08:33.545)
Yeah and deadbolt locks everywhere and things like that or just signs saying you've got all this stuff.

Bob Frady (08:41.802)
So the next three are all really one bucket. 73 year old home, built before 1978 with a fireplace. since this is down to the studs, that's not as much of an issue. You probably don't have to remediate lead paint. You probably don't have to remediate asbestos, but you do still want to check and you want to see whether you've got knob and tube wiring in the place.

and you gotta check on the sewer line. The sewer line's not reported. This is a 73-year-old property. It's in fixer condition. So if you don't know what the sewer line is, what do you do, John?

John - PropertyLens (09:23.091)
You pay to have it scoped. Send a camera down it and take a look.

Bob Frady (09:27.122)
And so this discount home has gotten a little bit more expensive to at least see what's going on. So you've got a sewer line inspection, which is not part of the standard inspection. You've got a water test that's not part of the standard inspection.

Those are two things that are gonna cost you when you get this place inspected. listen, you're probably not gonna get an inspection contingency on this unless somebody's desperate to dump it. But those are things that you should check before you buy this house. So this $80,000 bargain is getting more expensive by the minute.

Bob Frady (10:07.397)
Okay, from an insurance standpoint, here's the interesting thing.

John - PropertyLens (10:13.4)
Yeah, the replacement cost is three and a half times what it costs to buy the house.

Bob Frady (10:19.581)
Yeah, yeah, so it's a, it's a, yep, exactly, exactly.

John - PropertyLens (10:23.211)
It's cheaper to buy it than to build it. And make sure that you insure it properly because when that tornado comes along you're going to want to have it replaced.

Bob Frady (10:32.873)
Yep, so the cost to rebuild this is about $180 a square foot. You might even want to consider knocking it down in rebuilding, depending upon what the comps are in the area. Okay, most recent listing is July 18th. It's still on the market, 79.9. The assessment value is low, but the market value is low as well. So knocking it down in rebuilding is probably not such a good idea because you wouldn't get your money back.

No basement. Okay, here's what we see. Sold as is, no inspections or repairs. So, what happens when you have a no inspections or repair listing? What's the first thing you should do?

John - PropertyLens (11:13.205)
Thank

John - PropertyLens (11:18.974)
By this report

Bob Frady (11:20.637)
Get a property lens report. Absolutely you're correct, John Stigman. If you have a property that says as is, no inspections or repairs, the first thing you should get is a property lens report. Because we'll tell you, hey, listen, you need to, here's some things you need to check out here. Bring your vision and your work ethic. Five bedrooms, one bathroom. This is why people move. One bathroom is just not sustainable. You gotta put a second bathroom in there.

John - PropertyLens (11:48.308)
Well, no, you should always have as many bathrooms as you have butts to sit on the toilet. But here's one interesting thing. It says it's five bedroom, the county says it's four bedroom. Right there, you may have a just an entirely bigger mess on your hands than you're counting for.

Bob Frady (11:59.143)
Hmm.

Bob Frady (12:08.392)
So that's a question that you want to ask, why the discrepancy? So for right now, I'm in the chips if I spent 69 bucks on this report, because I know what I'm walking into, which is kind of a mess, but I know some things to look for.

Bob Frady (12:25.256)
you can also package it with another house if you wanted to. There you go.

John - PropertyLens (12:29.236)
which is probably right around the corner.

Bob Frady (12:31.4)
Yes, here's all the information about the municipality, the construction type, the ownership. So back in 2021, this house sold for $113,000 and is now selling, was listed last year for $169,000 and fell to $79,000. Yeah.

John - PropertyLens (12:54.956)
$80,000 discount.

Bob Frady (12:57.861)
That is a big giant discount and the question is what happened? Hard to say if we can see but we'll try to find out.

John - PropertyLens (13:03.892)
Well, I think we have a clue then.

Bob Frady (13:07.036)
What's the clue?

John - PropertyLens (13:08.524)
Indeed, for January of 2023, it's a limited liability company. Somebody was probably thinking about doing a flip.

Bob Frady (13:14.791)
Mm-hmm.

Bob Frady (13:20.987)
Yep. Sold it here. Yep.

John - PropertyLens (13:22.868)
and then thought better of it.

So if you're not as talented in a construction-minded way as the guys who make money doing flips, this should be a screaming run for the hills type of notice.

Bob Frady (13:41.111)
Yep. would look at this and go, wait a second, what's going on? Ask the listing agent, what the hell happened here? And if you're not good at fixing up a property, don't buy it. And if you're good at fixing it up, or if you've got good contractors who you don't mind paying, or if you just want to experiment, great. But otherwise, this place is dropped in half in value.

in six months, seven months. That's crazy.

Bob Frady (14:18.489)
Here's your taxes. Wow, taxes have, they're still relatively mild. They've gone up a few hundred dollars in the last few years. Here's properties. Down to the studs.

John - PropertyLens (14:32.797)
Somebody started to flip.

Bob Frady (14:32.847)
Yeah, Mike, somebody started it, didn't finish it. It's got some land. Here's a design. Excuse me.

John - PropertyLens (14:42.08)
gonna need to add some bathrooms to that.

Bob Frady (14:46.502)
So my suspicion is that there might have been a hail event that wiped everything out, but that's not true. The last major hail event was in 2011, now they had three of them.

John - PropertyLens (14:47.21)
Watch the hand.

John - PropertyLens (14:54.408)
Nope. Nope. Scroll over.

Bob Frady (15:00.535)
wait! There was a big hail of it.

John - PropertyLens (15:02.316)
2024 we had a wind event, 2024 we had a day ale event, and a couple of them. So if you put 20 % roof probability and 40 % of roof probability, you're gonna start, you know, eventually losing that roof.

Bob Frady (15:07.641)
Yep

Bob Frady (15:19.878)
Yep Here's a picture of the roof you can go back this goes all the way back to 2016 if you wanted to take a look So there's the house there's the house again tree grew more

John - PropertyLens (15:28.588)
That's a nice 10 years worth of coverage.

John - PropertyLens (15:34.72)
Three grew more.

and that's a tree that you want to have cleared off the roof. So there's another expense because you don't want any overhang.

Bob Frady (15:41.401)
Yep

Bob Frady (15:47.11)
So we estimate the roof is 10 years old. It looks like it was replaced in 2015. last about 30 years. Shingo roofs last about 30 years and the replacement cost is between $5812,000. Right now, you know, the roof condition is okay. It's not bad. One more hailstorm, who knows? 43 % tree overhang is a bit much. So you're wanna, you know, like you said.

John - PropertyLens (16:06.591)
Yes.

Bob Frady (16:16.484)
pair that back a little bit. Lots of information about the systems and the roof. potential threats and structural integrity. get soil runoff issue at this location. So the question is, what happens when it rains?

John - PropertyLens (16:38.334)
Yep. Where does the water go?

Bob Frady (16:40.71)
Yep, maybe there's some ponding on the property. Just ask. These are all questions you should ask. These are all survivable events, but ask the question before you buy. Because even though it's $79,000, it's still $79,000. It's nothing to be shaking a stick. If somebody gave me $79,000 today, I'd be a happy guy. So if I had to spend it, if I had to spend $79,000 today, I'd be an unhappy guy. So.

John - PropertyLens (17:01.932)
and you wouldn't be buying this house.

Bob Frady (17:09.06)
Make sure you ask the questions. Water's good. termites, there's no mine subsidence in this area, which is good. Here's the permits that we have. Electrical permit issued, restoring service to the unit. Well, that's interesting.

John - PropertyLens (17:29.866)
Yep. So somebody walked, decided, you know, no reason for me to pay the electric bill anymore. And we had to get a permit issued to restore the service.

Bob Frady (17:42.405)
Wow, yeah, so this is a fixer fixer fixer for sure. Water heater was replaced in 2020. Furnace replacement was in 2019. And the electrical service was established in 2017. Oh, this is interesting.

John - PropertyLens (18:06.476)
Look at that!

Bob Frady (18:10.199)
A soup. Yep.

John - PropertyLens (18:12.207)
2013's. Redid the sewer pipe. Still would have it scoped though.

Bob Frady (18:15.949)
Yep, absolutely.

John - PropertyLens (18:18.432)
What it looks like is somebody had plans for this house. It was keeping it up and then somebody came along and bought it thinking they could do something with a flip. And then that just didn't happen.

Bob Frady (18:21.817)
Big plans.

Bob Frady (18:30.757)
no such luck. So it's not in a 100 year or 500 year flood zone which is great, low risk of flood which is lovely. As you can see from the map, nothing there. And you're a mile from the nearest flood zone. What are the climate risks here, John?

John - PropertyLens (18:32.938)
things like.

John - PropertyLens (18:50.496)
it gets hot, it gets humid, ice falls from the sky, both as a hail and as an ice storm. And you know, there is some winter weather which then leads to thawing and threasing and ice dams and stuff like that. I mentioned earthquake you are near the new Madrid vault. Last time it went in the 1850s.

Bob Frady (19:10.084)
Mm-hmm.

Is it new Madrid or new Madrid? I think it's new Madrid. I'm going down with Madrid. Okay.

John - PropertyLens (19:16.204)
depends on your accent and where you're from. Is it roof or is it roof? For our people in the Midwest, it's roof. So call it any way you want. Back to where I was, the Little Mississippi actually flowed backwards for a month after that earthquake. Lightning.

Bob Frady (19:36.068)
So here's my interesting ice storm story about, well interesting to me anyway. When I was in college I had an interview in Kansas City, which is not St. Louis, I understand it's not the same thing, but it's in the same general area, roughly area. Yeah, but when you're from Massachusetts, it's close. So that's where I discovered my first ice storm. Everything is sheeted in ice.

John - PropertyLens (19:51.006)
across the state.

John - PropertyLens (19:55.82)
It's okay.

Bob Frady (20:04.076)
and it is incredibly perilous because it'll around electrical lines, it's very heavy, it will take things down. So ice storms are no joke.

And this place gets real hot in the summer, cold in the winter, enough to form ice.

John - PropertyLens (20:23.692)
there you go lightning not a surprise tornadoes we discussed plus side you're not gonna have an avalanche there are no mountains you're not gonna have hurricane because you know we're near the Atlantic and you're not gonna have wildfires or landslides landslides because you have no hills wildfires because you're not in the right part of it and if st. louis gets a tsunami lots of really really bad things

Bob Frady (20:51.692)
That would be bad. Well, here's part of our story.

John - PropertyLens (20:54.848)
Crimes.

Yeah, here's part of our story. This is not the safest of neighborhoods. You got rape, got aggravated assault, burglary, motor vehicle theft, and murder. Notice that wasn't in the description of the property when you looked at it.

Bob Frady (21:18.135)
Yep. Why? Because realtors can't tell you what the crime rate is in an area. It looks like redlining. However, before you buy this, you're going to want to know because if you're going to fix that place, you're going to have to guard it against theft because this is a high crime area. So if you're leaving equipment there, what's that?

Yeah, exactly, that's what I meant. During the rebuild, you're gonna have to guard this place. And you wanna know that.

John - PropertyLens (21:50.604)
That's good add to your cost. Not too much of a surprise on this little map. There are the known sex offenders in the area. So if you're thinking, you got five bedrooms, you're probably thinking, hey, great place for kids. no.

Bob Frady (22:08.918)
Yep. Well, there's better places for sure.

John - PropertyLens (22:13.14)
Yes.

John - PropertyLens (22:19.126)
There's the neighborhood, you're not taking the bus anywhere, you're probably not walking too many places. However, it's quiet, it's not near the road, it's not near rail, not near the airport, and the town itself has pretty decent natural disaster resilience. They're used to handling the issues. So should something happen, they'll be there for you.

Bob Frady (22:38.753)
Yep.

Bob Frady (22:45.122)
Points of interest, mine is always where's the nearest fire station. And there aren't any within three miles.

John - PropertyLens (22:51.488)
Well, that's not a different points of interest. This is schools and EV charging stations and farmers markets and childcare centers, universities, things along those lines.

Bob Frady (22:55.137)
that's right. That's true.

Bob Frady (23:08.917)
All right, pollution factors, PFAS, mold, radon. When you get to the seas, you get to the questionable areas. And we're always big fans of guarding against the unnatural. you will with a, to the strip, to the studs construction.

You don't have to worry about mold as much, but you do want to make sure that you take a look. And for radon, you may want to take a look as well.

contaminated sites not too close Spanish Lake Park is the nearest one underground storage tank is about four tenths of a mile away but what's interesting here is there's a lot of sinkhole activity in this area so it didn't score high for sinkholes but there are three different sinkholes within a mile of this location that's pretty that's pretty interesting

John - PropertyLens (24:02.806)
Yep.

Bob Frady (24:08.8)
Let's see, the nearest formerly clandestine drug lab, which is always a fun one to look at, about a mile and a half away, but back in 2009.

Bob Frady (24:19.436)
Fire and medical response pretty good, law response probably not as good.

Bob Frady (24:26.849)
And here we go. Here's the nearest fire station. right down the street. Spanish Lake Fire Protection Station number two, which is really good from a fire protection standpoint. And the second one is 0.78 miles away. So you're pretty well covered. You've got three stations within three miles. If something should happen, you've got pretty good response from the fire departments.

John - PropertyLens (24:31.957)
Yep.

Bob Frady (24:50.945)
Estimated utility costs is relatively low for a property of this size. Amaran is your provider and you're going to spend about a thousand dollars a year. If you're looking at solar, it's a 15 year payback, 10 years with federal incentives while they last, but not necessarily a high return type of investment. Insurability.

You got high crime and hail, which are gonna be the two things that drive your insurance rate along with the age and condition of your roof. Those are the big ones in this area. And 6 % per year is actually a little bit higher than average in terms of the renewal rate. So your premium's gonna jump by a third over the next five years if the current trend continues.

Lots of data about the house if you want to get, listen we get lots of people who want to give you insurance so pop them all in there. And then finally our property timeline, we're just listed in July of 25. Something happened to this house and I can't quite figure it out. So it was listed in November at 169, relisted at $79,000. Crazy. And here's the thing.

John - PropertyLens (26:05.872)
I think what happened is that LLC went bankrupt and they're just getting rid of the properties.

Bob Frady (26:10.143)
Yep.

Bob Frady (26:14.719)
Just dumping it. Okay, so let me stop sharing my screen.

Bob Frady (26:25.472)
So John, let me ask you something. For a $79,000 property, do you think that you would have gotten value from a $69 property lens report?

John - PropertyLens (26:30.246)
Ask away.

John - PropertyLens (26:39.536)
absolutely. We identified a number of issues that you just aren't going to get. So in this case, the seller seems like, or the previous owner seems like an LLC. So there's nobody living there. There's nobody to talk to. You're buying essentially an abandoned flipped property.

And unfortunately, or fortunately, depending upon your opinion, they got it down to the studs. So you can't live in it. You can buy it. I guess you could live in it, but it's not really livable. you know, knowing that before you go in might even give you a little bit more leverage. I don't know how much further low you could go than $80,000 on this property.

And maybe you can get a little bit more on the concession side. It is as is, so any concession is just going to be on the price. But understanding what you're getting into and what the costs are associated with it and what the issues could be and the crime, the, you know, would be my biggest concern. Yeah.

I might have thought about this and 69 dollars later I'm not thinking about it anymore. I'm out.

Bob Frady (28:12.052)
I take a slightly different view of things. Is it worth a $69 property lens report on a $79,000 house? And the answer is absolutely. Because the realtor's probably not going to be able to tell you a whole lot. This property looks like it's being dumped for one reason or another. They're selling it as is, no inspections, no nothing.

You want to come to the door knowing what you're getting yourself into. Now, for those of you who are adventuresome and who want to do a rebuild of a property, this is a great canvas to work on. You've got some footprint, you've got some walls, I don't know what they look like, but you know you're going to have some extra costs associated with rebuilding this house than you would otherwise.

So my take is I'm not necessarily scared by this house. It's going to cost more than you think to rebuild because it's a little bit more complicated to rebuild. But there's an opportunity here to build a house, get out relatively inexpensively.

and either bring it to market value or rent it out. So if you're the kind of person who's, like maybe you're young, you know, you're young and dumb, this makes you a lot smarter about buying the place. So I say absolutely 1000 % worth the cost of the report because it's a little more complex than it looks.

John - PropertyLens (29:41.1)
Thank

John - PropertyLens (29:53.782)
But let's take this a slightly different way. You're out looking to buy a house, any house. On average, how many houses does a homebuyer look at, 10, that's the number. And...

Bob Frady (29:56.479)
Okay.

Bob Frady (30:02.003)
Mm-hmm.

Bob Frady (30:07.305)
Ken.

Bob Frady (30:12.029)
Well, hang on, they'll look at hundreds, but they'll consider 10.

John - PropertyLens (30:16.204)
They'll consider 10. They'll look at hundreds. So you're down to your favorite 10. And if you're earning $100,000 a year, you're making $50 an hour. It's going to take you at least an hour to go look at each one of these atoms. So that's 10 hours of your life, or $500.

Bob Frady (30:27.327)
Mm-hmm. Mm-hmm.

John - PropertyLens (30:44.876)
For $399, you have 10 property lens reports. You're up 100 bucks right there, not including your spouse or partner or friend or whoever you're buying the house with. You've already made money, essentially, on the houses. And if you take out of the equation the five or six that you now absolutely don't want because of what you learned,

Bob Frady (31:03.698)
Yep.

John - PropertyLens (31:13.226)
That's six more hours of your life saved.

Bob Frady (31:15.934)
Maybe even more because you might go to the you might rank order those 10 and say this is the one two three and then by the third one you're like these are the one that's the one I want I don't want to go see the other seven I save myself that time So yeah, you you're right

John - PropertyLens (31:34.004)
That's where the value is, on top of everything else. Your time is worth something, and your realtor ought to be providing these reports to you.

Bob Frady (31:38.43)
that's the extra it's worth a lot more than 50 bucks an hour. You know how much time I, I, I bill myself at $400 an hour when my feet are up on the couch watching a football game. That's $400 an hour. I charge myself during that time. It's like that relaxation time is key.

So you've to think about the time value of your own time. And most people don't. That's the problem. Maybe you want to see it out of curiosity. Maybe that's your hobby. But gosh, this gives you a tool to help you go through, okay, here's 10, maybe not these three, maybe not these five. Here's the ones we want to focus on. All right.

John - PropertyLens (32:20.458)
That's what I'm saying.

Bob Frady (32:21.903)
Any parting thoughts there, John? That sounded like a parting thought. Any more parting thoughts? Okay, time value. Time value of money. Plus anybody who you go with. So I look at it this way. You gotta have a certain sense of adventure to buy this property. And you gotta know what you're doing, because it's a little more complex than a first timer might wanna tackle.

John - PropertyLens (32:26.218)
That was my farting sound. Nope, that's it.

Bob Frady (32:49.022)
But that said, it's an opportunity to own a slice of America. Nothing wrong with that. Alright, so for this week's episode of Property of the Week, I'm Bob Frady.

John - PropertyLens (33:01.417)
I'm John Sigman.

Bob Frady (33:02.865)
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