Buying a Gut Renovated Property

Buyers frequently ask me, “What is the difference between buying a gut renovated property and buying a ‘ground up’ new construction property?” 

The difference is that a gut renovated property typically keeps the framing and foundation of the home intact, while just about everything else is gutted out and made new. A new construction “ground up” property means everything is knocked out and removed and the builder starts from scratch. 

For smaller 2 or 3-family condo conversions, you will find that the vast majority of units are actually gut renovated since it often doesn’t pay for the developer to go through the effort of knocking everything down and starting from scratch. (It also takes many more months to go this route). 

It is important for you to understand the nuances here, because if you don’t ask the right questions, you might think you are getting a new construction condo when you are in fact getting a gut renovated property.

Even within the gut rehab world, there is a sliding scale. For example, some gut rehabbed properties are fully gutted and everything is removed except for the foundation and the framing. Other gut rehabbed properties might leave in place the heating system, electrical, plumbing and other items.

So it’s critically important that you clearly define from the seller what is old, HOW old it is and what is new. If you don’t, you could end up in a situation where you think you are buying a brand new condo that in fact has multiple elements that are 10, 20, 30+ years old!