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If you’re preparing to buy an investment property, you’ve probably already performed due diligence—examined the property in detail, checked out records and negotiated the cost of any repairs into your final purchase price. Unfortunately, many real estate buyers, even savvy investors, tend to overlook a fairly serious problem when checking for potential issues with a real estate purchase: The presence of pest problems.
But first, if you would like to learn more about how unresolved pest problems can negatively impact your financing capabilities, click the link below to book a free strategy call today.
The Impact of Pest Problems
In most cases, pests are easy enough to deal with. A few appointments with an exterminator— preferably while the building is still vacant—usually gets the problem under control quickly.
But sometimes, pest problems can balloon out of control. The result? Serious structural damage to the building, causing you to lose out on your investment. And, if tenants move into a rental building while it’s still infested, it could cause a serious loss of trust between you and your tenants. Either way, there’s significant damage to your reputation as a property owner.
Every real estate investor needs to take a careful look at potential investments for pest infestations. If you suspect a pest problem at a property you want to buy, you’ll have to examine the severity of the issue, the type of pest infesting the structure and potential remediation strategies.
Identifying pest problems
If you suspect a pest infestation, hire a third-party pest removal consultant to provide you with an objective rendering of the potential risks of carrying through with the sale.
The type of vermin and the length of the infestation will determine how significant the damage is. While rats are an unsanitary annoyance, for instance, a short-term infestation isn’t likely to cause serious structural damage. Termites or carpenter ants, however, could eat away at the structural integrity of the building.
But how do you know if you should be worried in the first place? Here are a few warning signs to look out for when touring a potential investment property:
Check for signs of common household insects, like ants and cockroaches. Cockroaches, in particular, will leave sticky deposits that look like streaks or trails along the walls and ceilings. While you may think of these bugs as a simple nuisance, cockroaches are dangerous! They’re associated with respiratory problems. Ant infestations are generally harmless but can cause tenant discomfort.
Mice and rats
Known for spreading lice, ticks and disease, rodents are the last thing you want to find in your investment property. Thankfully, it’s usually easy to spot the signs of a rodent infestation before you close. Mice and rats tend to leave droppings in areas where they congregate. Check the basement, garage, attic, closets and kitchen cabinets for rodent droppings or signs of gnawing. Holes along the baseboards, particularly in corners, could indicate a rodent population living in the walls.
There are few pests more feared and reviled than bedbugs, and for good reason. Once a bedbug infestation takes hold, it’s nearly impossible to get rid of it. Most people unknowingly pick up bedbug infestations while travelling through hotels. Unlike most other pests, it’s very difficult to diagnose a bedbug infestation while examining a property. There are a few telltale signs you can look out for: Rusty stains on the carpeting and furniture could be bedbug feces.
To determine if your potential investment property has a termite infestation, you’re going to have to knock on wood—literally! Unlike most other household pests, termites pose a danger to the structural integrity of the building because they eat away at wood and drywall. Check for mud tunnels along the foundation of the building and lookout for signs of termite tracks on exposed wood. Also, knock on beams and studs—if they sound hollow, there might be a termite problem at play.
Discover Residential Property Management With This Step By Step Guide
Once you’ve determined there is, in fact, a pest infestation at your prospective investment property, you’ll have to estimate how bad the infestation is. From there, you’ll know remediation steps are available and feasible.
Pest remediation strategies can vary wildly, depending on the type of pest that’s taken up residence in the property and the severity of the infestation.
Common pest remediation strategies include spraying for insects and bugs, like moths and ants. If the infestation is mild and relatively recent, a few spraying appointments should take care of the issue, so long as you schedule regular appointments with your exterminator to keep the infestation away.
Some bugs are more complicated to get rid of. For instance, bedbugs need heat treatment to get rid of them fully. Exposure to high levels of heat is the only effective way to kill off a bedbug infestation. This means buildings infested with bed bugs need to be vacated and treated with a special machine designed to raise the air temperature of a building. It’s usually also necessary to dispose of all carpeting and furniture when dealing with a bedbug infestation.
Termites, on the other hand, require a home to be ‘tented.’ This is when a vinyl tent is wrapped around the building and fumigated with a powerful, high-intensity pesticide. In most cases, this eliminates the infestation but can leave the building uninhabitable for several weeks.
Rats and other rodents are often removed with a combination of traps and poison. While these are effective methods to address rodent infestations, they also pose a danger to pets and small children. It’s important to communicate with your tenants about ways they can keep their children and pets safe if you’re addressing a rodent infestation.
Say goodbye to pest problems for good
While pest problems are rarely a deal-breaker, they should give you pause before purchasing a property. It’s important and advisable to weight pest infestations when deciding whether you want to move forward with a transaction. If nothing else, calculate the cost of remediation and negotiate that into the sale price of the property. And, if you do decide to tackle the problem on your own after the closing, be prepared to consult with a professional on the proper course of action.
Now, if you would like to learn more about how unresolved pest problems can negatively impact your financing capabilities, click the link below to book a free strategy call today.