We recently purchased a flooded home after Hurricane Harvey by chance, and since we’re out there already, we’d like to buy a few more. We’ve spoken with a few of our new neighbors, and they’ve relayed the experiences y’all have had with some of the house buyers. First and foremost, we want you to understand that while we are investors, but we’re Texans first.
In the two weeks following the storm, my husband pulled 16-hour days with the Cajun Navy performing water rescues in multiple neighborhoods, while I focused on helping friends and strangers alike in Old Katy muck their homes. Within those first weeks, we raised over $20,000 for Harvey relief from friends and colleagues across the country that went directly to affected families in the area. Our focus was on helping things get stabilized; we didn’t make an offer on a single home flooded in Harvey until almost three months after the storm.
I say this not to pat ourselves on the back, but to let you know that when we say we’re Texans first, we mean it. We want to make offers that are reasonable offers for everyone involved. If you need to sell a flooded house fast in Katy or the general Houston area, we can help.
Flood Home FAQs
You’ll find a list of the frequently asked questions we receive from homeowners in general here. You’ll find a list of flood specific frequently asked questions below.
If my house was worth X before Harvey, does that mean you’ll be offering me that number minus the cost of the needed repairs?
No. Again, we’re completely transparent. We’re buying the home as-is. We’re on the hook for any unforeseen expenses – like it failing to achieve a mold-free certification or finding out that the plumbing needs replacing.
We’re also paying our private money lenders interest over the 3-4 months it takes to rehab the home and will incur fees when we refinance with a traditional lender or sell the home once it’s complete. And we don’t know how long it will take to rent or sell the house once its repairs are complete.
It could also take years for the homes in Bear Creek to get back to their full pre-storm value, and we have to refinance or sell based on what they’re worth once the rehab has been completed. The typical hit we’re expecting to take on the home’s pre-Harvey value – assuming the home has flooded once – is 10-20%.
Every investor needs to make a profit to justify taking on the risks involved with buying a flooded home. The difference is in how much each investor tries to make off the deal.
My neighbor down the street got X for a similar home. Shouldn’t I expect to get the same amount?
Keep in mind that there is a difference between a home selling and a home receiving an offer that is accepted by the seller. I get an alert several times a week about a flooded home in Harvey that went under contract coming back onto the market because the deal didn’t close. Typically that occurs because an investor made an offer before realizing how much it would cost to restore the home – and the deal would not turn a profit at the initially agreed upon sales price, so the investor backed out. That’s why we put so much research and detail into our offers before we make them.
Also, understand that a home that listed at X and then went under contract didn’t necessarily receive a full price offer. Homes being sold as a result of being listed by a real estate agent incur a commission that is paid by the seller out of the proceeds from the sale. Additionally, those homes may not have had closing costs covered by the buyer. The above means that their net proceeds from the sale can vary significantly from the black and white sales price.
How many houses flooded in the Houston area during or as a result of the rain dropped by Hurricane Harvey?
The numbers released by the DPS after Harvey give a picture of how damaging the storm and its resulting rains – which forced controlled dam releases – were. Harvey is said to be responsible for over 275,000 homes being damaged and over 15,000 houses being completely destroyed. Harris County took a huge bulk of that damage, with over 110,000 homes being damaged and Fort Bend County saw over 8,500 homes receive damage.
I’ve heard some chatter about potential lawsuits surrounding compensating the owners of homes flooded in the dam releases for the losses they incurred in the floods. Know anything about it?
No, we don’t – aside from probably having heard the same chatter you have. That said, we’ve added a passage to our contracts giving up any rights to those claims so that the potential for any future compensation that might arise out of them remains with you as the owner at the time of the flood. We’re not trying to profit twice from the same deal.
Why do you ask if I got money from FEMA or as a result of having flood insurance?
Whatever money you may have received from FEMA or your insurance company isn’t a factor in our offer price from the perspective of offering you less because you also received a payout of some kind. We hope that you receive every dime of compensation – from insurance, FEMA, or us – that you can manage to obtain. We solely ask if you received money from a flood claim because it can affect future insurability for the home and we need to know what we might be dealing with.