When your looking at buying and selling real estate, construction cost and budgets are always at the fore front. Missing big ticket items that were not budgeted for can be costly.
For example I went and looked at a property Saturday that might be a great flip candidate. Looked great on paper and the home was located in an area that had low days on market. When I saw it the property was loaded with additions and electrical issues. These were probably not permitted by the city and they would be costly to correct. I also noticed the home had a bad foundation, no garage, and needed a new roof. Could probably still do ok money wise on the property, but I felt the risk was to high and passed.
In a lot of cases I like to always replace the electrical panels, and update the plumbing. Buyers are always looking at the function part of the home. Plumbing, Electrical, Foundation, roof and windows. They also want a nice kitchen and bathroom. These things are paramount to most home buyers.
I saw another agent that had purchased a flip property for an investor, I always watch an study what everyone is doing. This home was purchased on a busy street with an apartment across the street. On top of all those problems the home as next to a Ford dealership. The home is not only going to be hard to sale, but it will also be hard to lease. Would you want to live on a very busy street, with a dealership next to your home?
Real estate and flipping homes can be costly and knowing how to look at homes defiantly puts you ahead of the rest of home flippers.