And the winning bid goes too...
After the success of the TAJO house sale, I was itching to find another one. After searching and searching I came across this poor little thing just screaming for a makeover. It was about the same size at TAJO and appeared to be in way better shape. Located in the Fox Run neighborhood of Kempsville, which happens to be a few miles from where Jason lives currently and grew up. We felt really confident in the location. It was listed at $239K which was way more than my conservative margins would allow on paper but Jason and I decided to have a look anyway. We quickly made the decision to go for it and like all investors, we decided to lowball it because, well, it's a Freddie Mac property and you're not hurting anyone feelings. (Sidenote: Doing this in our current market to a seller does not work 99.9% of the time. They get pissed and offended that you don't have the same love for their crusty old home and this can really backfire on you if you really do want to buy it. Consult me for more info.) That evening I raced home to place a bid. I was informed almost immediately by the agent they had already accepted a bid.....BUUUUUMMMMMER. So It was back to the drawing board. I viewed over 12 homes by myself over the next few weeks before settling on a few with good potential. So I got Jason's contractor blessing on 3 bank owned homes and decided to bid on them all! After a heated negotiation, only 2 remained and both asked for my highest and best. I knew I was up against other investors but when you play in the big leagues you can not get caught up in what others are doing. You have to call it somewhere and not stretch yourself too thin. I submitted my offers and crossed my fingers. The next day I get an email from both listing agents with a counter. HOW ARE YOU GOING TO COUNTER MY HIGHEST & BEST??? When you get asked for Highest & Best you submit your highest & best! GEEZ....And then there was 1. I resubmitted the exact same offer as before and a few days later I got another email from the listing agent saying they decided to ACCEPT my offer but I had to close by the 30th of April. Which happened to be 10 days away! I said yes to the distressed...property!!!! I really felt like a winner because my offer was $48,000 BELOW list price and ironically the exact amount that won me the bid on the TAJO house. I felt it would bring us luck and IT DID! So here we go again! Fingers crossed this one will be even better than the last!
Sometime in May...
Slow & steady wins the race.
SLOOOOW it begins. Jason and I had a meeting to discuss the plan of attack. We realized after the last project we made several mistakes and luckily it worked out but we could have really screwed ourselves. The fact that we even made money on it was a miracle but thanks to my wide conservative margins and really pushing the sales price it all worked out. So we wanted to make sure we did everything possible to plan smarter. We are really taking our time to get more quotes and working through potential problems early. Although this new home was not nearly in as bad shape as TAJO, it wasn't without its faults. It was a neglected home as most bank-owned homes are and we wanted to make sure we addressed all the neglect before even crossing the proverbial "design bridge". She is currently a VERY ugly, VERY brown & yellow, mid-70's, 2-story home with 4 bedrooms, 2.5 baths and about 2300sf. She has a formal living, dining, kitchen, small den with a fireplace and a huge addition which was basically another family room. There is such a thing as too much space when some buyers tour houses. I hear people say all the time, "I'm not sure what I would do with this space". Well, folks lucky for you I Do! When in doubt, add a master suite on the first floor! So by the end of this journey, she should transform into a lovely, modern, traditional home with 5 bedrooms, 3.5 baths with 2 master suites, 1 upstairs and 1 down. Talk about adding value $$$. That is rule number #1 of the REHAB club. Always make sure what you are doing is adding value, whether it be monetary or desirability. I am so sick of seeing these lazy flippers buy crappy homes, paint the walls, slap on a roof-over, install granite countertops and call it a day. It doesn't do the new owners or neighbors any good if you aren't increasing the comps in that neighborhood. Lucky for me, Jason and I have the same philosophy regarding rehabbing. We do unto these homes as if we were going to buy them ourselves and we 100% stand behind our work. We don't cut corners, we pull the necessary permits and complete all inspections the city requires & I will even get this home inspected prior to listing by one of the most notorious home inspectors in the land so I can list with confidence. We ain't messing around! Our reputation means everything and we truly care and want people to LOVE their home when we sell it to them.
Don't blink you might miss it...
Steve & Steve the newest crew member framing in the new larger opening into the family room
Giving that old sprinkler system a tune up!
Audette's garage doors adjusting the track
The crew has really kicked it into high gear over at the house this week. Although there wasn't much, all the demo has been completed and we are finally putting this puzzle back together.
It truly is amazing what can change in one day when you have everyone working together.
Steve "the Great", our foreman and expert framer got that silly upstairs window, that was bugging the crap out of me, reframed and centered over the door. I don't know what the original builder was thinking, but clearly he was on something! We are also closing in two windows down stairs to accommodate for the location of new powder room and down stairs master bath. After thinking more on this I should of left a window in the master bath but if I change that now, Jason would probably use one of his Veto's anyway. He only gets 5 Veto's and he has used 1 already on the kitchen island design. He hoards those veto's like little bits of gold.
Yesterday I went to ProSource to look at tile for the master bath. This place is insane! It is almost too much to choose from, however, I selected 2 options and brought them back to the house for input. Option 1 vs Option 2 is about 50% more...Guess what everyone likes...?
Part of the struggle of our rehab projects is we want to make our homes look more custom and sometimes its worth spending a little more to get that WOW factor in the places that matter most when selling a home. Master bathrooms along with Kitchens are the number 1 selling features. So it is important to choose wisely. It's a fine line to walk. You don't want to be too specific with your choice and risk not appealing to the masses but I am tired of the same old same old. Our last house sold quickly because we gave it that designer feel. If it's working for you, why do it differently now?
Which option do you like more?
Not only are they making moves on the inside but the outside is coming along nicely too. I called the city of VB and got a yard debris dumpster delivered so we could remove all the VERY over grown bushes from around the house and trim back some of the large tree branches. It really opened up the house a lot and was needed in order for our roof package to be delivered as well as to allow access for the window and siding to be installed as well as the brick mason. Dare I say she got even uglier over night, now that all the foliage has been cut back but soon this ugly duckling will be the bell of the ball.
Sneak peak on the Kitchen design!
3.2.1....Journey to the center of the earth...flip
We love progress yes we do! We love progress how bout you!
Major item #1 was the new plumbing for the 1/2 bath and new master bath down stairs. Unlike the last rehab on TAJO we did, this one is not on a crawl space which makes relocating plumbing and electrical a little more labor intensive. We had to saw cut and jack hammer the concrete up to trench in the new route for the plumbing in the baths as well as the kitchen island. (By todays code, all built-in islands must have electrical in them.. just FYI) This is a very messy, very labor intensive job so we put Paul on the task of digging it all out. He's by far the youngest on the crew and those other old dudes cant swing a sledge hammer like they used too! Now it looks like we were trying to find the center of the Earth or bury a dead body...?
Major item #2 is the electrical. When I purchased this home it had Aluminum wiring which to say the least is less than desirable to most buyers due to the safety aspect and maintenance it requires. I was convinced that we had to rewire the entire home in order to make it right but after speaking with my electrician and my home inspector I learned that would be absurd to rewire the entire home (the cost is almost $16,000) and we just needed to replace all outlets and switches with a special kind that is specifically made for aluminum. Now we did run fresh copper wire in some of the house like the kitchen where its more important and the large family room off the back already had copper because it had been added on after it was originally built. Either way the home is now safe and once they finish up the city inspector will come out and review everything before we close the walls back up!
Major item #3 is the new roof! I am sure the neighbors are happy the outside is finally getting done. She was the ugly duckling on the block. I am a little concerned about my decision not to change the gutter color. I decided to select a brown roof hoping it would just blend in. The neighborhood is very traditional and there are a lot of homes with brown accents. The gutters and metal wrap on the home had been recently updated and I didn't want to spend the money to replace it. You can paint gutters and metal but the home I currently live in has that and its pealing and looks crappy. We are doing a new taupe colored siding and the new windows will be white. Also adding new colored shutters and a front door color will hopefully draw your eye in and take away from the enormous amount of brown that was on the home when I bought it. I think I am leaving the garage door brown but re-wrapping the trim around the door in white to match the windows. I am hoping this doesn't look ridiculous but sometimes you have to do it and see. If it sucks then Its a small replacement cost to change the trim or door color.
The crew also ripped out and cut down all the crazy over growth around the house and trimmed off a few huge branches on the big tree in the front yard. Now its nice and opened and you can actually see the house. They loaded up 2 huge yard debris dumpsters I got from the city of VB. (The cost is only $40 during the week and $75 on the weekend if you ever need a yard over-hall and don't want to dump it yourself....your welcome!)
Next comes windows and hopefully we will have some walls put back together next week! Kitchen cabinets have been ordered and should in hopefully in 3 weeks....Gosh that feels like a long time!!!!
Anyway, Happy Fathers day everyone! Enjoy your weekend!
July to September...
Fast forward to the GRAND finale!
I'm skipping over a bunch of long and boring things. But basically I fell behind with my posts and it's now sold and gone and I'm filing in the blanks off of memory! (SORRY)
We got it finished and listed August 5th! It turned out way better than I ever imagined and I priced it aggressively high for the neighborhood. But the most important thing to remember when doing your own rehab is to add value and MAN WE SURE DID! We took a 4 bedroom, 2.5 bath house and made it a 5 bedroom (with 2 master suites - 1 on the first floor) and 3 FULL bath house! That adds a TON of value in the end and it DEFINITELY paid off.
I wanted to get the publics opinion so I put together a little BBQ and invited the neighbors, some past clients, friends & family and the feedback was incredible. A lot of folks who lived in the neighborhood were happy to see it was an eye sore no longer and couldn't believe the transformation!
We are happy to announce we sold for a record breaking $45K ABOVE any comp in the neighborhood and closed in 30 days at a final sales price of $355,000! Did we go over budget...? OF COURSE WE DID...we always do! We estimated about $75K and spent about $90K when it was all said and done but it was clearly worth it in the end. We still made a fair profit (taking in a total of about $30K) and turned out another beautifully solid home! See the pictures below of the final outcome AND Stay tuned for the next one!!!!
to Sussex house
a collaboration with Majestic Homes
Welcome to the new HOUSE!
See the video tour below and follow our journey