Would You Buy This House: How to Walk a Property Like an Investor | #45

Return on Design

In this episode of Return on Design, hosts Rachel Niederhofer and Justin take listeners on a virtual property tour, demonstrating how to evaluate homes

Key takeaways

• The most successful property evaluations go beyond emotional reactions and focus on identifying investment opportunities.
• Structural issues like sloped floors, cracked walls, and poor drainage are early indicators of deeper problems that affect long-term value.

Main topics

• Investor mindset in real estate
• Property walkthrough checklist

Notable quotes

"Most buyers walk through a house asking, 'Do I like it?' A smarter question might be: 'Where is the opportunity?'"

"If it ain't math, then it's not worth it."

Conclusion

By combining architectural insight with structural scrutiny, Rachel and Justin demonstrate a

Transcript preview

Speaker 1 (0:00) I'm looking for what I call the obvious kind of defects. What does the yard look like? Is it well-maintained? Is it mowed? Are there weeds everywhere? What does the kind of structure of the home look like? Is there anything that's jumping out and standing out that points out there could be an issue? What does the roof look like? Is it nice and smooth and look well-maintained? Are there big patches, holes missing? You know, things of that nature. Is water standing in the yard or what appears to be a bad drainage? Those are all signs of maintenance or giving me a general sense of the overall how a property was maintained and cared for. Because that gives me an idea of what other issues could be lurking. Speaker 2 (0:47) Welcome to Return on Design, the podcast where beauty meets strategy and interiors become assets that perform. I'm your host, Rachel Niederhofer, designer, investor, and builder of high-impact spaces that deliver real results. Alongside my husband, I run both a design firm and a real estate investment company, where I live at the intersection of creativity and ROI every day. Each week, I'll be unpacking what most people overlook. how strategic design decisions can grow your investment, elevate your lifestyle, and unlock the full potential of your property. You'll get real tools, proven strategies, and unfiltered conversations with industry experts who are doing it right. So if you're ready to invest with purpose and Speaker 1 (1:32) leverage design as a powerful tool, this podcast is for you. Speaker 2 (1:37) We have purchased a lot of homes over the years and each one has taught us something different. I think years ago, I would ask, I would walk into a house and I would think like, how could this house serve me? And now when I'm evaluating properties, I'm thinking, where's the opportunity here? How can I improve this property? Speaker 1 (2:00) Yeah, because those are two completely different questions. And the things that make you fall in love with a home, aren't necessarily always the things that make it a great home to purchase, especially as an investment. Speaker 2 (2:12) Yes, that is so true. And so today I want to take the listeners on a little property tour. What we do when we look at a property, how we evaluate it, things we notice, pay attention to, and the questions that we ask before we ever really position an offer. So come along with us on this little tour today. Let's pretend that we are driving in the car and we are headed to check out a property. And before we even pull up, or I should say, before we even walk inside, we just pulled up to this property. Justin, what are you looking for? Where's your eye going? Speaker 1 (2:57) I'm looking for what I call the obvious kind of defects. What does the yard look like? Is it well-maintained? Is it mowed? Are there weeds everywhere? What does the kind of structure of the home look like? Is there anything that's jumping out and standing out that... points out there could be an issue. What does the roof look like? Is it nice and smooth and look well-maintained or are there big patches, holes missing? Things of that nature. Is water standing in the yard or what appears to be a bad drainage? Speaker 2 (3:31) Those Speaker 1 (3:31) are all signs of maintenance or giving me a general sense of the overall how a property was maintained and cared for. Because that gives me an idea of what other issues could be lurking. Speaker 2 (3:47) And now my perspective, we just pulled up where my eye goes is front elevation. So immediately I'm looking at the architecture. Where is the placement of the front door? And is it open, closed off? Is there a seating area, a porch? Things like that I pay attention to. Of course, curb appeal. which would lend more to the landscaping and how does that really look. And then I would say windows and paint. Because I'm thinking, you know, painting a home is a costly endeavor. So I usually do pay attention. Like, is the paint peeling? If it has paint, if not, like, what's the stone or what's the mason work that's been done? Quality. Speaker 1 (4:38) And how does it look? Yeah. Speaker 2 (4:40) More on the aesthetic side first. And then secondly, I'm thinking. If it's not the aesthetic I want or I see a defect in the craftsmanship that's affecting the aesthetic, I think about what would it cost to get the aesthetic that I want. That's what I'm focusing on for 60 seconds. Okay. So we just pulled up, we've evaluated the exterior and we've gotten out of the vehicle and we're walking in to the property. Justin, you're up. First 60 seconds, you've just stepped foot inside. Where do your eyes go? Speaker 1 (5:22) First thing I'm looking at is floors and walls. What does the flooring look like again? How does it appear to have been maintained? Or is it original or does it look like it's been replaced, done, gone over? And then the walls. What does that paint look like? Is it chipped? Again, are there bubbles? Are there bows? Are there holes in the wall? We've walked into several places that have holes in the walls and you're like, okay, I'm fixing them. Speaker 2 (5:52) Yeah. I can remember looking at one property and as soon as we walked in within 60 seconds, you noticed that the entire floor was sloped and then you immediately identified a crack in the wall and you were now hyper-focused on foundation. Speaker 1 (6:11) Yeah. Speaker 2 (6:11) When I didn't even see that at first. Speaker 1 (6:13) And that's why. It's because, you know, to me, some of those things are more obvious. And it's just the way that my eye is trained to look at them. You have a different lens that you view some of this through. So that's part of what makes our team so great is that we see a lot of the same things, but we also see a few different things that it's like, hey, you need to know about this or I need to know about that. Speaker 2 (6:38) Yeah. So for me, just open the door for 60 seconds. Where does my eye go? Definitely architecture. I look at ceiling heights, the light, natural light, material. I pay a lot of attention to the scale. So I'm looking at size of doors, size of openings, and light. I can't, I think I said that already, but light is a big deal. So how is the light coming in? And that affects how I feel immediately as well. I do also look at flooring and paint, but I'm more concerned, I think, with architecture within that first 60 seconds. Ceiling height is important as well. And then I really go into more of a walkthrough process where while Justin's over there seeing is the foundation cracked. I'm like, what's the flow? What room is where? Oh, if I go left here, you know, I walk into the office and then I, you know, wander into maybe a den or the primary living and over to the kitchen. Where's the master? Is it secluded? Ooh, I like a secluded master. And what type of finishes are in here? If there's not high-end finishes, but I have this amazing flow and floor plan, I'm already seeing, ooh, opportunity here because floor plan is a lot more challenging to modify than just finish selection. And as I'm going through the ebb and flow of walking the space, I'm thinking, number one, does it make sense? I'm looking for any excess of wasted space. So as I'm evaluating each space, I'm defining what is this used for? What is the intent of this? Which helps me determine that's a waste or that was great, great function. And then lastly, I'm really thinking, who is this built for? If we came in right now, and didn't make a whole lot of changes, who is this ideal client in mind? Speaker 1 (8:50) So Speaker 2 (8:51) from an opportunity perspective, I'm already thinking, this was designed originally for somebody. Who's that somebody? And how can I make sure the opportunity still can fit a somebody? Speaker 1 (9:07) Yeah. And while you're walking through looking at that, I'm kind of walking through on a similar, you know, thought of and going around again with just the structural. What is what does it look like? You know, and indicators I'm looking at do look at, you know, what are the plugs look Speaker 2 (9:24) like Speaker 1 (9:24) this wall switch plates? Because those are indicators of what what's behind the wall. You know, if if it's old. If it's a really old house and every outlet's super dated and yellowed out, okay, is there another underlying issue? It's probably never been updated there.