I’m not an expert, but I have family that operates within this industry, unaffiliated with the ugly homes organization.
Tl;dr The idea is that these companies buy homes that have fallen into a state of disrepair, fix them up so that they comply with modern building safety regulations, slap on a new coat of paint, then sell the property for a profit.
Since they don’t fully investigate the issues that the home has before making an offer, they make offers that are wildly lower than most valuations would indicate, which leads to the reputation of being scammy. Sometimes there are structural issues that are extremely expensive to resolve and the project is barely profitable, but in other instances there is little repair work required, and they make a big profit. Lowballing every offer ensures that they can’t lose, but also means that this is rarely a good option unless you are in serious financial straits.
I’m not an expert, but I have family that operates within this industry, unaffiliated with the ugly homes organization.
Tl;dr The idea is that these companies buy homes that have fallen into a state of disrepair, fix them up so that they comply with modern building safety regulations, slap on a new coat of paint, then sell the property for a profit.
Since they don’t fully investigate the issues that the home has before making an offer, they make offers that are wildly lower than most valuations would indicate, which leads to the reputation of being scammy. Sometimes there are structural issues that are extremely expensive to resolve and the project is barely profitable, but in other instances there is little repair work required, and they make a big profit. Lowballing every offer ensures that they can’t lose, but also means that this is rarely a good option unless you are in serious financial straits.