Real Estate Marketing & Beyond
Mold is a serious and costly problem to correct. Some states require sellers to disclose any known mold problems and to get a mold removal right away. But keep in mind that they only have to disclose what they know about and not all states even have this requirement. What homeowners know and disclose falls far short of an expert opinion. It’s a red flag that the house has a very serious problem but don’t expect a solution to be suggested or provided.
Almost certainly, the owner has at least tried several unsuccessful (if inexpensive) solutions. Mold can be growing in almost any part of a house. Places with a constant supply of water are the most common (kitchens, bathrooms, laundry rooms). Also, around windows, roofs, and water pipes just to name a few other common culprits.
Besides looking bad and putting out an unpleasant odor (sometimes but not always), mold causes health problems. In the worst cases, these are mycotoxins. Mycotoxins lead to rashes, seizures, unusual bleeding, respiratory problems, and severe fatigue. The type and severity of health effects that result from mold exposure is widely variable across different locations, from person to person, and over time. The good news is that most molds are not toxic.
If you live in a dry climate, your chance of encountering molds is reduced but in no way is it eliminated.
According to a mold remediation specialist, mold in a house is a strong indication of a water leak of some type. It could be from the plumbing, a leaking roof, ground water seeping into a basement or the house foundation, leaking doors, etc. Houses built so airtight that the house can’t breathe are prone to mold as well. All of which will need repairs.
A house with mold problems can be a good opportunity to invest at a substantial discount. However, be sure to consider your repair costs beyond just cleaning up the mold. Obviously, the mold will quickly return if the source of moisture isn't eliminated.
Once mold has a foothold in a house, consider that it is also living in heating, ventilation, and air conditioning systems. These may need to be professionally cleaned, or better yet replaced.
My intention isn't to scare you away from taking advantage of deeply discounted houses with mold problems but instead to make sure you take into account all of the possible repair costs.
A house inspector might let you know about a mold problem. However, until you have ample experience with moldy houses, I advise you to have the house inspected by a mold remediation specialist to determine the full extent of damage needing to be repaired before making any offer on the house.
Personally, I don’t live in an area that has a ton of mold issues. If mold is a common problem in the area you invest, consider becoming the expert. When you find a problem to solve, you become the go to person for solving that problem. Even investors in distressed properties shy away for mold problems.
In the same way that foundation repairs and burned houses need specialized expertise, so do mold houses. Do not underestimate how much a professional mold remedy can cost. When you start dealing with the environmental issues that come with mold or asbestos, the repair costs can be extensive and a permanent solution elusive. However, by becoming an expert in a niche field that no one else wants is any part of, you will become the person who can most accurately estimate repair costs. Solving problems that others cannot is how you make big money as an investor.
Please leave a comment if this article was helpful or if you have a question.
Author bio: Brian Kline has been investing in real estate for more than 35 years and writing about real estate investing for 10 years. He also draws upon 30 plus years of business experience including 12 years as a manager at Boeing Aircraft Company. Brian currently lives at Lake Cushman, Washington. A vacation destination, a few short miles from a national forest. With the Pacific Ocean a couple of miles in the opposite direction.
