Why I Will Never Buy These Types of Houses Again

TLDR

Over 15 years and 300 flips, two types of houses have burned me hard enough that I will not buy them again. Houses on a hillside that behave like a sponge, and houses where a pro DIYer has been inside the walls.

Table of Contents

• House 1: The Sponge
• The Right Way to Fix It
• House 2: The Professional DIYer
• What to Look For Before You Buy
• Why I Still Encourage You to Buy
• FAQ

House 1: The Sponge

I bought a house for $30,000 on a hillside. Great deal on paper. If I removed some trees in the backyard, it would have a view of the city. Obviously it needed work, but the numbers made sense.

As soon as we closed, water started pouring into the basement. I did everything you are supposed to do to stop water on a hillside property. Tiered retaining wall system with French drains. New gutters. Regraded the yard. Rerouted all surface water away from the house.

After tens of thousands of dollars, water was still getting into the basement.

Here is the setup we built. Picture the house sitting at the bottom of a hill. Water runs down the hill toward the house. So we dug tiers into the hill, each with a retaining wall and a French drain behind it. Surface water hits the first retaining wall, drops into the French drain, gets rerouted around the house. Some water passes the first tier and hits the second, same thing happens there. Some passes that and hits the third tier. Gutters on the roof catch everything landing on the house itself and carry it out around the sides.

Done right, that setup handles any normal hillside. The water never reaches the foundation.

But the water was still coming in.

One day we were digging out a trench on the side of the house to tap into the city sewer line. The guy running the dig called me over and pointed at the bottom of the trench. There was water flowing. A stream, three feet below the surface.

That is when I realized the hill was a sponge. It was springtime. It rained every other day. The hill held water like a wet towel, and once it got saturated, an underground river was running three feet below grade. The house was a rock sitting in the middle of that river. And rocks in rivers always lose. The water wears them down eventually.

You cannot stop water on a hillside. You can only redirect it.

The Right Way to Fix It

There is a fix. It is expensive and it does not make the house more desirable to the buyer, but it works.

You do not try to block the underground water. You let it come in, and you give it a controlled path out.

Step by step:

1. Waterproof the inside of the basement wall where the hill meets the house. Thick waterproofing membrane.
2. Cut a few feet of concrete out of the basement floor along that wall, making a shallow U-shape around the sides.
3. Install a French drain in that trench, connected to a sump pit in the middle of the basement.
4. Install a sump pump in the pit. The pump runs when water collects and discharges it outside.

Now when underground water pushes through the basement wall, it hits the waterproofing membrane, drips down into the French drain, flows to the sump pit, and gets pumped outside. Water in, water out. No damage to the structure.

The Resale Problem

Even with the fix installed and working, the story to a buyer is “we expect water to come in, and the pump keeps it moving.” That is a tough sell. You lose real money on the sale because the buyer knows the house has a chronic condition. That is why I will not buy on a hillside again. The fix works. The resale does not.

House 2: The Professional DIYer

The second house was in one of the best neighborhoods in town. Three stories: basement, main level, second story. The plan was to separate the basement from the upper floors, meter them separately, and run it as a duplex. Light renovation on the main level, a wall and a separate electrical meter in the basement, done.

I bought it. We opened the first wall to start on the electrical, and what I saw was terrifying.

And that was just the first wall. The deeper we went, the worse it got. The whole house had been worked on by somebody who thought they were an electrician, a plumber, a framer, and an HVAC tech. They were none of those things.

One saving grace was supposed to be the new PVC plumbing throughout the house. Brand new PEX supply lines, brand new PVC drain lines. Looked great. But when you pull permits on a renovation, you have to do a water test. Fill the lines with water, leave them under pressure, check for leaks. Every single joint in the PVC was leaking.

We ended up having to prop up the house, tear the framing out, and reframe from scratch. Old decks had been partially enclosed to make interior living space, with their own DIY framing, DIY electrical, and DIY HVAC, all wrong. The whole house was effectively worth nothing. We rebuilt it from the inside out, new-build prices on a renovation budget.

A pro DIYer inside the walls can mean a total tear-down on a house that looked livable from the street.

What to Look For Before You Buy

Hillsides are visible. Pro DIYers hide. The trick is to spot the signs before you close.

Signs of a Pro DIYer

Look for these on the walkthrough:

• Odd framing visible from the basement ceiling or attic. Short pieces where full studs should be. Mismatched lumber.
• Wiring that does not match throughout the house. Different gauges, different wire colors, mixed metal and plastic boxes.
• Plumbing fittings that look wrong: mismatched materials, homemade transitions, too many joints.
• Converted decks or porches that became interior space. If the exterior outline does not match a clean rectangle, be suspicious.
• Permit history that has gaps. If the house was clearly updated but no permits were pulled, somebody worked on it who should not have.
• HVAC that does not feel standard. Wrong duct sizes, undersized returns, equipment that looks like a side-job install.

Signs of a Sponge Hillside

• The house sits on a significant slope, not a minor grade.
• Basement walls show efflorescence (white chalky residue) or staining.
• Existing French drains or sump pumps in the basement.
• Saturated soil in the backyard even in dry weather.
• Neighbors upslope have visible drainage systems.

Pro Tip

If I see extensive DIY work on the walkthrough, I either pass or I price the house as if I am doing a full gut-and-rebuild. Not a cosmetic renovation. Not a full renovation. A gut. Every wall comes off, every system gets replaced, every stud gets inspected. If the numbers still work at that cost, maybe I buy it. Usually they do not.

Why I Still Encourage You to Buy

I did not make this article to scare you out of real estate. I made it so you do not walk into these two holes on the way in.

Bad things happen in this business. A few years ago a tornado ripped through my town and tore houses out of the ground. One family I know went into a basement closet during the storm. When they came out, their house was gone. But they rebuilt. That is what real estate people do.

You will run into a storm eventually. Probably not a literal one. Probably a sponge hillside or a pro DIYer or something worse that I have not written about yet. You are going to get through it. And what you will have on the other side is not as much money as you hoped, but a lot more skill than you had before.

Skills are what make you durable. A storm can take your money. It cannot take what you have learned. Every bad deal teaches you something that protects the next ten.

Real estate is not safe because nothing goes wrong. It is safe because the skills compound faster than the losses.

FAQ

How do I know if a hill is steep enough to be a sponge?

Rule of thumb: if you would not want to walk up it in a snowstorm, it is steep enough to act like a sponge in spring. Anything with more than a modest grade at the back of the lot, especially with trees on it, is worth extra diligence. Check for existing drainage infrastructure on the property or neighbors.

What if I already own a sponge house?

Install the full waterproofing and French drain system described above. It is expensive (often $15,000 to $25,000 or more), but it is a real fix. Do not try to just block the water. Let it in, let it out.

Can I catch a pro DIYer with a home inspection?

Sometimes. A thorough home inspector will flag obvious wiring or framing weirdness. But much of pro DIY work is hidden inside walls and only becomes visible once you open them up. The best protection is your own walkthrough eye and a willingness to walk away from a deal with too many red flags.

Is there any hillside I would buy?

A small slope with normal surface drainage, yes. A true ridge or mountainside, no. The risk-to-upside ratio does not work on steep terrain. The upside (a view) is cosmetic; the downside (chronic water) is structural.

I am new. Is this stuff likely to happen to me on my first deal?

Possibly. First deals are where most of us make the expensive mistakes. Use this article as a checklist. Walk the property slowly. Ask questions. If something looks off, it is off. Trust the gut, then verify.