Don’t Buy a Money Pit House

Money Pit Home Photograph

Buying a home can be stressful and exciting. For first time home buyers, the process is one that can include tunnel vision with just getting into a home of their own. A house that appears ideal at the right price can be hard to pass up. However, no home is perfect and it is important to be cautious, patient and thorough when purchasing a home. If this is not done, you could end up with a money pit house. This will end up being a home that has endless repairs and expenses. It will equal the purchase of a home with a blank check.

Imagine you find a home that is just the right size with the ideal layout. It is in a great neighborhood with the best schools and it is priced right. The house may even appear to just need a little maintenance and cosmetic work to bring it up to your standards. The home could also look to only need some minor layout changes to make it work.

With all the things buyers look for when purchasing a home, there usually comes a time when a number of the requirements are met to make the decision to buy. A purchase choice should not only be based on the surface requirements but what also is underneath. A home inspection before buying a house should always be a requirement. A well-qualified inspector will check for major structural components, interior plumbing issues and things like electrical systems. Heating/air conditioning systems and roofs will also be checked. The American Society of Home Inspectors lists a number of items that are included in a standard inspector’s report.

Even with a home inspection, it is important to be able to identify things yourself that may or may not be on a standard report. This will save you time and money when looking at homes before the inspection to identify a home that has the possibility of being a money pit. It will also help with recognizing details to get a home at the right price so it does not become a never-ending money pit.

What Are Some of the Things to Look for in a Potential Money Pit Home Purchase?


Foundation issues on a home should be a real red flag. This is often noticeable through cracks in walls, bricks or floors. Windows and doors that stick or won’t close correctly can also be a sign of possible problems.

foundation crack photo

A few hairline cracks might not be anything too serious as homes do tend to settle and shift slightly over time. However, larger more prevalent cracks can be a reason for concern. When looking at the home see if there appear to be any bulges or uneven parts of the house. A good home inspection will often uncover foundation issues, but if there is something missing it can be very costly at some point in time. Home foundation issues can end up costing thousands of dollars to repair. If it is extremely bad, a completely new foundation could be $40,000 or more.


Replacing a roof on a home is not typically something anyone wants to do immediately following a purchase. There are all different types of roofs from shingle to tile and metal. Missing tiles or shingles is a sure sign that there are issues. In addition, shingles that are curling and degrading is a warning signal the roof’s life is coming to an end soon. Depending on the type of roof repairs or a complete replacement can cost thousands of dollars. It is not always practical, but when looking at a home a rainy day is never a bad thing.

Stains inside on the ceilings or walls can also show possible water damage from a leaking roof. Look closely for spots that might appear to have fresh paint or repairs. These little telltale signs can end up saving thousands of dollars in a not so distant future.


Issues with plumbing in a home are one that I can personally identify with. Older homes will often be more susceptible to possible areas of concern. If a home is not piped in copper as it should be, problems may not immediately appear. But it will not be too long before issues will start to show. Steel pipes tend to corrode and rust over time after years of exposure to the water. In addition to the corrosion, they can cause a real health hazard when using the water to cook or just drinking it out of the tap.

My personal experience with plumbing and my home purchase is with cast iron. The house itself is piped in copper as it should be, but the lines outside the home connecting to the sewer line and located under the foundation of my home are cast iron.

Moving into my home it took about 8 years to finally identify the hidden issues with my plumbing. Off and on for a number of years the one bathroom seemed to have a problem with draining water out of the shower. A plumber would unclog the problem and life would continue. It finally got much worse and a camera was put through the plumbing under the home. The issue identified was a crack in a cast iron pipe under the concrete slab in my kitchen. The entire outside system was cast iron.

Talking with the plumber about the problem he noted that home inspectors do not typically check the outside plumbing lines so any issues would not have been identified. The problem is cast iron is really only meant to last about 50 years compared to today’s PVC pipes which can have a life of 100 years.

Luckily for me, we did not have to start tearing up the inside of my home. New pipes were tied into the kitchen and bathroom from the outside and back to the sewer. Part of my driveway did have to be torn up and the overall cost was enormous, but now I no longer have to worry about the cast iron pipes. Issues like this can easily run $5000 to $10000 or more. It was an expense my wife and I were not prepared for. The plumber said most people do not pay to have a camera put down their plumbing system before making a purchase. I would highly recommend this for an older home.

If you find a home that is 50 or more years old, go the extra step in addition to a standard home inspection and get all of the plumbing checked thoroughly. It may cost a few hundred dollars more, but it could potentially save thousands of dollars in repairs later. If a home has leaking pipes under it, this has the potential to cause major foundation issues in the future.


Having nice big trees that provide shade to a home can be great, but they can also be a nightmare. This issue is not one that I have seen many people mention as large expenses. Now that the issues with large expensive plumbing items have been mentioned, trees can also be a cause for plumbing problems as well. Root systems that have had decades to grow can find their way into outside pipes. When looking at a home be mindful of large trees or even keep an eye out for areas where one might have once been. Old roots could still be underground and eventually cause problems.

Pipes are not the only issue with large root systems. Big trees right next to a home can cause damage to a foundation over time with roots growing underneath. If a home you are thinking about purchasing has trees that are very close, be sure to have them investigated further for any possible problems.

Trees that are old and dying also pose costly problems. With my home, there was a large oak tree in the backyard. It was quite old and eventually started to pose a danger. The cost to remove the tree was $2000. Having two or three of these on your property that is nearing the end of life can be a big expense.


A home that has old windows should be cause for concern. Replacing them is very expensive. With older homes, they may add character and charm, but they might also keep heating or cooling monthly bills high. It might be easy to just look at a home that appears to be the perfect one and easily convince yourself you will just have the windows replaced. Yet it is important to know to replace an entire home of windows can cost $10,000 – $20,000 or more depending on the windows and the number needed.

I made the window mistake with my home purchase believing it would not be long before they would be replaced. Ten years later I still have the same windows. They do their job, but I know new ones that are not 50 plus years old would keep out more noise and lower the cooling bill. I am hoping this may be the year they are finally replaced.


Home electrical systems are one of the items inspectors will check. Homes that have older electric setups can be dangerous and should be replaced. These can be costly and it should be something that you try and negotiate to have replaced before moving in or have a home price lowered to cover the cost. Codes and local regulations will often even make a home sale not possible without an electrical system that is up to date. An up to date electrical panel should be installed. The cost to completely replace an electrical system is not inexpensive. Depending on the size of a home the cost to rewire a house can cost $8000 to $15000 or more. Something to keep in mind when looking at an older home that might have outdated electric.

Hazardous Materials and Mold

If you are thinking about buying an older home, dangerous materials like lead paint and asbestos could be lurking. It is best to get testing done and ensure there are no issues. Many years ago, materials used in building homes were not known to be an issue, but they are now identified as causing serious dangers. Removal of hazardous materials from a home can be expensive. According to House Logic, complete removal of asbestos in a home from walls, ceilings, pipes, attics, and roofs could be as high as $30,000.

Mold is another costly hazard and it may not be an issue with just older homes. Moisture that gets into a home from a leaking roof or flood can potentially present mold problems. When looking at homes pay particular attention to musty smells and moisture.

When looking at homes the first time I can remember going into one that had just the circulation fan running inside. Something did not seem right as it had a very musty smell. My wife and I liked the home but had a gut feeling of problems. Our realtor reached out to the seller’s agent and told them we may be interested in the house, but would want to have a mold inspection done. This was not well received. The seller’s agent stated they would prefer if we did not do this. This was all it took. The reason they did not want it done is that if mold was found, then it would have to be out in the open for any potential buyers.

Mold is much like asbestos when it comes to the cost for getting rid of it. It is just expensive.


The quality of water depends on the area a home is purchased. This is another issue that does not seem to be on the mind of many home buyers. Hard water without a water softener and treatment system can cause real problems in a home. Rusty bathroom fixtures, faucets, and any other places water comes into contact like a dishwasher or washing machine may need replacement with water quality problems. Water treatment systems can be inexpensive or run thousands of dollars depending on what is needed.

Although it might not seem like much at first to get good quality water running through a home that will not wear out appliances and fixtures, the costs to maintain them over time can add up. Systems also need to be completely replaced as they age.

Air Conditioning and Heating Systems

One of the largest expenses on a home is the AC and heating. Old or outdated systems that are nearing the end of their expected lifetime are costly to replace. The expense will depend on the unit needed depending on the size of a home, but it will be several thousand dollars. Like a roof, AC and heating systems are just part of home ownership. They will need to be replaced at some point so it may not be a complete deal breaker to buy a home.

In addition to the AC and heat, the ductwork in a home could be a hidden unexpected repair. Older ductwork using unhealthy materials or filled with mold is not an expense a new home would want to take immediately following the purchase. This issue again can mostly be with older homes and it is a good idea to have it looked at.


Home infestations of insects or rodents can cause significant damage to a home. When it comes to rats, roaches or just bugs, in general, it is not only damaging, but it is disgustingly gross. I would stay away from a rodent or roach infestation in my own opinion. It can be expensive to solve these problems, but even if solved getting it out of the mind might never be possible.

Termites and insects like carpenter ants are other infestations that might not easily be seen. But there are often signs of damage. Look for rotted wood and signs of what may appear to be sawdust. Termites might not be visible, but they do many times leave clues. Trees that are rotted out close to a home or old wood piled up should also be investigated. Termite infestations that start in the yard close to home many times end up at the house.

Luckily home inspectors do look for things that may have been caused by termite damage. If there appear to be any issues, the cost could be reasonable or astronomical. Home Advisor estimates average termite treatment to be $532. Larger infestations that involve tenting an entire home can cost $2500 or more depending on the size of a home. It is not only the cost for treating termites, but also the cost for repairs from termite damage that need to be factored into the overall expense.

Older Homes vs Newer Construction

When looking at homes to avoid a money pit there are many items to inspect to avoid costly problems. Most of the items mentioned are often with only older houses, but some of them can be something to look out for in newer homes as well. Just because a home is newer construction does not necessarily mean it will not have any costly problems. Inferior building materials, inexperienced contractors, and poor construction can all be issues in both newer and older houses.


Purchasing a home that will not result in a money pit can be subjective. Some buyers do not mind making updates and improvements if the initial purchase price is right. However, if you plan on buying a home that is turn key without investing thousands of dollars in a short period of time, it is important to know some of the more costly items that can cause problems. Things such as roofs and AC/heating systems will wear out at some point, but if they are near the end of their life it is important to not pay too much for a home. When it comes to foundation problems or hazardous materials, I personally would just move on to looking at another home for ultimate peace of mind. These are two items on the list that have a real potential for being unknown in their total price tag.

When it comes to an older home, there are two important points to consider which I have experienced myself frequently. I don’t really consider my home as a money pit, although it does feel this way at times. The first and only home purchase I have ever made is the one I still live in. It was built in 1956.

If you buy an older home that needs a little TLC and renovation, everything may cost a little more than usual. The main reason is the updated building codes. Every time it seems that I have something replaced an added feature needs to be put on to bring it up to code.

The second thing with an older home is standard today is not the same as standard 50 plus years ago. Door sizes, window sizes, and even my laundry room is dated to the point where you can’t just go to a big box home store to replace things and update them. A special order is the norm unless major changes are made.


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