New member introduction

[ghanwell]

Hello everyone,
My name is Greg Hanwell and I just signed up for membership this past weekend in Edmonton. I`m one of five partners that own a couple of restaurant and some properties. I first read Real Estate Investing in Canada a year ago at the behest of one of my business partners and have used it as the foundation for the model we use to invest. The Quickstart was great and I appreciated the insights of some of the veteran members that I had the chance to meet.
We put an offer on a property just last night and I`m excited to find out if we got it. I do have a question that I`m hoping someone has some experience with. The property is a nice family home in a nice family area that was repossessed by the bank due to missed mtge payments and the fact that it was being used as a grow-op. Apparently the operation was not in use for very long before the forclosure, maybe a month. We did a thorough inspection of the property and found no mould resulting but does anyone know whether CMHC (Genworth etc) have any provisions that could inhibit the eventual resale due to the property`s history as a grow-op?

 

[jeremyfleming]

Welcome to REIN Greg!

I am not overly familiar with grow-ops, but I would definitely look into it closer if I was buying one. I know that somewhere on this forum an expert lives that can address this concern: does the so-called mold show up immediately, or can it stay "dormant" for some time before "Blooming"?

Don had mentioned some time ago that he had hired an expert in the field to do research on this exact topic for the group (Drug houses) - perhaps Don or Russ has some info that can be shared here??

I am very interested in the answers.....

 

[DonCampbell]

Hi,

Unless actual mold remediation work has been done (rather than simple renovations) it still has a LOT of potential for problems down the road as the mold forms in areas you can`t see and makes it a `sick house.`

I recommend that you find a professional inspector to look at the property and you tell him to focus on the fact that it was an old grow-op. Mold, rot and hidden toxins should be there focus.

My take has always been to mitigate risk and avoid these types of properties, while other investors focus on getting ex-grow-ops and doing remedial work.

In times such as we have now (more properties available) you may find it less hassle and more profitable to continue your search OR to ask the vendor to pay for a HIGH QUALITY inspector to confirm the issue has been fixed properly.

P.S. Our `grow-op-expert` is on maternity leave until the new year

 

[mikecunning]

Hi Greg:

Definitely proceeds with caution!

In BC, a homeowner must disclose whether they have any knowledge if the property was ever a grow-op. I have heard horror stories of some municipalities pulling the occupancy permits until complete renovations (i.e. gutting etc.,) have been undertaken and passed a new inspection.

Good luck

Mike

QUOTE (DonCampbell @ Oct 25 2007, 08:24 AM) Hi,

Unless actual mold remediation work has been done (rather than simple renovations) it still has a LOT of potential for problems down the road as the mold forms in areas you can`t see and makes it a `sick house.`

I recommend that you find a professional inspector to look at the property and you tell him to focus on the fact that it was an old grow-op. Mold, rot and hidden toxins should be there focus.

My take has always been to mitigate risk and avoid these types of properties, while other investors focus on getting ex-grow-ops and doing remedial work.

In times such as we have now (more properties available) you may find it less hassle and more profitable to continue your search OR to ask the vendor to pay for a HIGH QUALITY inspector to confirm the issue has been fixed properly.

P.S. Our `grow-op-expert` is on maternity leave until the new year

 

[dplummer]

Mould can stay dormant until it has the right conditions to grow. ie: food source, moisture & RH% over 50%. Remember mould is part of normal plant life & will enter your home whenever a door or window is open. Eliminate the breeding area`s(as above) & mould won`t grow. As far as other toxins ,having an air quality test performed will tell you if other things are lerking. Doug