Buying fire-damaged houses is not a mass-marketing play. The deals come from three narrow channels — mitigation and restoration company referrals, fire-call tracking apps and local news reports, and direct outreach to owners you identify after the trucks leave — and the volume is capped by how often houses actually burn.
Dan Lennon has been in the fire service for close to 20 years and has spent the last four as a Central Florida realtor and flipper in DeLand, between Orlando and Daytona. He runs fire deals under a partnership called FireFlips with another agent, and his first one taught him what the spreadsheet never shows: the seller is usually underinsured, the closing waits on an insurance adjuster instead of a lender, and the rehab bid is only as good as the contractor’s license.
Below is how these deals get sourced, how to read a burn to separate a smoke-damage cosmetic job from a teardown, why a contract signed in August can close in April, and how to fund one without your own capital.
Key takeaways
- Restoration and mitigation companies are the highest-quality lead source for fire deals — offer them the rehab contract in exchange for the referral when the owner has no insurance or is underinsured.
- Fire confined to one area with smoke contamination elsewhere is often a cosmetic-heavy rehab, not a rebuild. Lennon’s first deal needed no roof and no windows despite smoke through the whole house.
- Verify contractor licenses and confirm permits are pulled before work starts. An unlicensed, unpermitted crew turned an $85K rehab into $120K on Lennon’s first deal — roughly a $40K hit.
- Fire closings run on the insurance claim, not the loan. One of Lennon’s deals went under contract in August 2024 and closed in April 2025 because a public adjuster was still fighting the carrier.
- Give the seller one honest maximum number up front instead of negotiating low-then-high — by the time you call, you may be the sixth or eighth investor to reach them.
From the Real Estate Pros Show
This article draws on an interview with Dan Lennon of RUPP’s / LPT Realty (FireFlips) on the Real Estate Pros Show, hosted by Cody Crabb.
Where Fire-Damaged Deals Actually Come From
The best lead source is the company that shows up right after the fire department leaves. Mitigation and restoration operators get to the property first, and they walk away from a meaningful share of those jobs — when the owner has no insurance or is insured for a fraction of build value, there’s nobody to bill.
Lennon’s arrangement with those companies is simple and worth copying: if they refer an owner who wants out, and the numbers work, he buys the house and hires them to do the restoration work. Their alternative was zero. His first deal came exactly this way — a mitigation company owner he knew called about an elderly couple insured for about half their build value who didn’t want to go through a rehab.
The second channel is fire-call data. Lennon tracks incidents through department-side apps, follows local news stories, and asks other firefighters where the fire the other night was. From there he pulls owner information and either calls directly or does a drive-by and leaves his card.
Speed alone will not win these. Lennon’s own estimate is that if he was on duty when the fire happened, he is the sixth, seventh, or eighth caller by the time he reaches the owner — behind restoration companies, other investors, and automated dialers.
A stranger is getting called by another stranger who’s trying to tell them, I’m here to help you. I have no credibility in their mind.
That reframes the outreach problem. You are not competing on being first. You are competing on being the one person the owner believes, which means a slower approach, a real credential, and no pressure.
Reading the Burn: Savable Structure vs. Teardown
The single most valuable skill in this niche is telling a smoke job from a structural loss on the first walkthrough, because most buyers write off both.
Lennon’s first purchase is the textbook version. The fire started in the garage and consumed the car. Someone opened the door between the garage and the house, which pushed smoke through the entire interior. Everything soft was contaminated. But the fire itself never left the garage.
His scope read on the walkthrough:
- No new roof
- No window replacement
- New electrical panel
- Rewiring in limited areas
- Full trash-out of everything smoke-damaged, plus drywall
- Pool untouched — the owners had recently redone it
That is a cosmetic-heavy rehab with an electrical component, not a rebuild. The house had a pool, good bones, and a seller who wanted out. A buyer who sees soot on every wall and assumes total loss walks past it.
The general principle: fire damage concentrated in one compartment with smoke contamination elsewhere usually leaves the structure, roof, and envelope intact. What kills a deal is fire in the roof structure, load-bearing framing, or multiple compartments — at which point you are pricing a new build and the land value has to carry it.
Lennon has a limited construction background, but 20 years of walking into burning and burned buildings means he can look at a room and know whether the damage is surface or structural. If you have adjacent trade experience — mitigation, water damage, restoration, insurance — that same read is your edge, and it is the reason to look at these at all.
I told my buddy during the whole process, treat it like we’re paying for a college education, and this is our tuition. If we lose every cent and it just breaks even, at least we learned how to do it.
— Dan Lennon, RUPP’s / LPT Realty and FireFlips, Central Florida
The Rehab Overrun: What Unlicensed, Unpermitted Work Costs
The rehab on that first house should have cost about $85,000. It came in at $120,000 — roughly a $40,000 overrun that only got absorbed because there was enough margin in the deal to eat it.
The cause was not the fire damage. The crew tied to the restoration company misrepresented their licenses and never pulled permits. Lennon trusted the referral relationship, let the work run longer than he should have, then fired them mid-project and brought in a different contractor to fix what had been done. That contractor is the one he uses on everything now.
The fix is a verification sequence you run before anyone touches the house, not a lesson about trust:
- Pull the license yourself. Look it up in the state database by license number, not by the company name on the truck. Confirm the class covers the trades in your scope.
- Confirm insurance directly with the carrier, not from a PDF the contractor emails you.
- Write permits into the contract as a milestone. No permit numbers on file, no draw released.
- Verify the permit exists with the building department before the first inspection is due, not after.
- Separate the referral from the work. A restoration company that sends you deals is a valuable partner. That does not mean the subs it puts on the job are qualified for a permitted rehab.
The last point matters most in this niche, because the referral-for-work trade is what generates the deal flow. Keep the trade, but bid and vet the crew as if they came from nowhere.
Why Fire Deals Close Slowly — And How to Contract for It
These closings run on the insurance claim timeline, not the financing timeline. Lennon put one house under contract in August 2024 and did not close it until April 2025 — eight months — because the seller was locked in with a public adjuster who was still fighting the carrier over the loss.
That is the structural risk in the niche. The seller often cannot convey clean or cannot agree on price until the claim resolves, and a public adjuster working on a percentage has no incentive to settle early. Lennon also suspected that adjuster was angling for something questionable, and his position was that if it got shaky he would hand over the paperwork and walk rather than fight it.
Three practical adjustments:
- Write extensions, don’t walk. Lennon’s default is to give the seller two, three, four, even six months and extend the contract as needed. Someone who just lost everything cannot move on your schedule.
- Don’t tie up capital you need elsewhere. An eight-month escrow is fine when a partner funds at closing. It is expensive if you have hard money committed and idle.
- Give one honest maximum number up front. Lennon tells sellers plainly that another buyer might beat him, but the number he offers is his ceiling. No start-low-go-high. When the owner is already fielding calls from six other people, a single unmoving number is the credibility play.
Build the extension mechanism into your purchase contract before you need it, and set a walk-away trigger you will actually honor.
Funding and Exiting a Fire Flip Without Your Own Capital
Lennon funded the first deal with a hard money loan. He has since replaced that with a partnership that requires none of his own money: the partner funds the entire deal, Lennon sources it and runs it as project supervisor, and they split proceeds 50/50.
That structure fits the niche well. Fire deals are found through relationships and read through experience — both of which are the sourcing partner’s contribution — while the capital side is commodity. It also removes the pressure that makes long escrows painful. When you are not carrying a hard money note, giving a grieving seller six months costs you patience instead of interest.
On the exit, Lennon lists the property himself and waives the commission so the split is calculated on a larger number. If you already hold a license, that is real money on every deal and one of the stronger arguments for getting licensed before you start flipping.
Be realistic about volume. Lennon does a handful of these a year — one to three at his current bandwidth — around a full-time fire schedule, a realtor business with five closings in a busy month, and two kids at home. His ceiling if he retires from the department is around ten flips a year, and he is candid that fires simply do not happen often enough to build a high-volume acquisition channel on them. His team lead does roughly 30 flips a year, but not from fire-damaged houses.
Treat this as a high-margin, low-frequency lane that runs alongside your main acquisition channel, not a replacement for it.
Who Buying Fire-Damaged Houses Actually Works For
This works for people who already have a reason to be in the building after a loss. Mitigation contractors, water damage and restoration operators, insurance people, and fire service personnel all have two things a general flipper has to buy: the ability to read damage accurately, and an existing relationship with whoever gets called first.
Lennon’s advice to someone in that position is sequenced:
- Get licensed. Not to sell houses — to learn property evaluation, comps, and ARV calculation properly, and to keep the commission on your own exits.
- Get in the room. Paid training programs work if you can afford them. If you cannot, find local investor groups and get around people already doing the deals you want to do. Lennon made 100 calls a day and read constantly through a first year in which he closed nothing.
- Turn your trade relationships into a pipeline. Ask every mitigation and restoration contact the same question: what do you do when the owner has no insurance? Then give them an answer that pays them.
Budget for the first one to go wrong. Lennon and his partner framed the $40,000 overrun on deal one as tuition, and it bought them a contractor they still use and a verification process they now run every time. It only worked because the deal had enough margin to absorb it, which is the real underwriting lesson: on your first fire flip, buy at a number that survives a 40% rehab overrun.
Flipping generally is more competitive than it was. Fire-damaged supply is limited, but so is the number of buyers who can look at a soot-covered house and price it correctly.
Frequently asked questions
How do you find fire-damaged houses before other investors do?
The most reliable channel is a referral relationship with mitigation and restoration companies. They arrive at the property first and abandon jobs where the owner is uninsured or badly underinsured — offer to buy those houses and hire the same company for the restoration work, and you get the call instead of nobody getting it.
Secondary channels are fire-call tracking apps, local news coverage of residential fires, and asking contacts in the fire service where recent calls were. From there you pull owner information and either call or leave your card at the property. Expect to be the sixth to eighth person contacting that owner, so plan to win on credibility rather than speed.
How can you tell whether a fire-damaged house is worth rehabbing or is a teardown?
Look at where the fire itself was contained versus where the smoke went. Damage confined to one compartment — a garage, a kitchen — with smoke contamination through the rest of the house usually leaves the roof, framing, and windows intact, which makes it a cosmetic-heavy rehab plus electrical work rather than a rebuild.
Fire that reached the roof structure, load-bearing framing, or multiple compartments is a different underwriting exercise, and the land value has to carry the deal. On Lennon’s first purchase, a garage fire that pushed smoke through the entire house still needed no new roof and no window replacement — only a new panel, some rewiring, and a full trash-out.
Why do fire-damaged property closings take so long?
Because the closing waits on the insurance claim, not on your lender. If the seller has retained a public adjuster who is disputing the loss with the carrier, the seller often cannot settle on price or convey until that fight resolves — and a percentage-paid adjuster has no reason to settle quickly.
Lennon had a contract signed in August 2024 that did not close until April 2025 for exactly this reason. Write extension language into your purchase contract from the start, avoid tying up expensive capital during the wait, and set a walk-away trigger you will actually honor if the claim turns questionable.
What goes wrong most often on a fire-damage rehab?
Unverified contractor licensing and unpulled permits. On Lennon’s first deal, the crew connected to the restoration company misrepresented their licenses and never pulled permits, turning a rehab that should have cost about $85,000 into $120,000 — roughly a $40,000 overrun. He fired them mid-project and replaced them.
Verify the license number in the state database yourself, confirm insurance with the carrier directly, and make permit numbers a condition of releasing the first draw. Keep the referral relationship with the restoration company, but vet its crew as if they walked in off the street.
Can you buy fire-damaged properties without using your own money?
Yes. Hard money works for a first deal, and a capital partnership works better after that. Lennon’s current structure has a partner funding the entire deal while he sources it and acts as project supervisor, with proceeds split 50/50 — he brings the deal flow and the damage read, the partner brings the cash.
Not carrying debt on the purchase also makes the long escrows in this niche tolerable, since an eight-month wait costs patience rather than interest. If you hold a real estate license, listing the property yourself and waiving the commission adds directly to the split.
The bottom line
If you have a trade relationship with anyone who shows up after a fire, start there this week: ask them what they do when the owner is uninsured, and give them a reason to call you instead of walking away from the job. That one conversation is the entire acquisition channel.
