Flip Thy House

I’m All Out of Nearing the Finish Line Phrases and/or Metaphors

It’s been a pretty crazy week or so, but things are pretty much done at House #2. Refinishing the hardwood floors was the last major hurdle, which I finished staining at like midnight last night. Still need to hit them with a couple of coats of poly and still have a little bit of grouting to do, but the punch list is dwindling pretty rapidly. We’ve got an open house on Saturday for a city-wide tour of homes thing, then another showing scheduled on Sunday, so I’ll still be over there most nights this week wrapping things up, but it’s all definitely downhill sledding from this point on.

I’m not one prone to wasting much time patting myself on the back, but the house does look damn good. Photos to come soon, once everything is completely done, cleaned, and de-cluttered. I can’t say that I haven’t wanted to just light and match and walk away from it at various points, but regardless of what the bottom line numbers work out to be, the finished product is a very nice house that some family will enjoy, that’s a far, far cry from the original state when I bought it.

Before any of you lurking haterz seize on that last statement, the numbers aren’t looking too terrible as far as the budget, even with contractor woes factored in. Total investment is going to be about $31,000, which includes repair costs, mortgage-related fees, carrying costs, utilities, pretty much everything.

That’s a good bit over my $25,000 budget that I was so proud of, so boo, me. A lot of that overage is from the plumbing work, which I simply didn’t have enough experience to budget correctly, as far as what it actually costs to add a new bathroom. I also didn’t budget in a new larger water heater, thinking I could use the functioning (but too small for two bathrooms) existing one. Again, boo me.

The bulk of the remaining overages were from Contractor #1-related woes. Again, boo me. Thanks for all of the comments and feedback regarding paying contractors hourly, and all of the ways that can go wrong. Lesson definitely learned there. Not something I’ll ever do again.

To be slightly fair, though, there is another side of the coin to the situation. Not to make excuses, but I did get a lot of value out of the hourly arrangement at a few points in the project, especially with the trenching work for the bathroom addition and jackhameering and sawing out the concrete for the bathroom addition. I got bids from assorted contractors at the beginning of the project for that work and they were running in the $4,000-$5,000 range for knocking out both those jobs; I ended up paying Contractor #1 about $750 in labor/equipment rental costs for tackling both, so I did gain some ground there.

But overall, yeah, not a smart way to go, and not only was it my fault for allowing it to happen but doubly my fault for not pulling the plug earlier when it became clear they were seriously dragging their feet on the sheetrock and other finish work.

As far as other budget overages, it mainly was the death by a thousand cuts that sneak up on you, as far as not budgeting correctly for all of the little things towards the end such as smoke alarms, a new mailbox, outlet covers, new doorknobs here and there, etc. My Misc. category wasn’t anywhere as large as it should have been.

Planning on listing it at $147,500, so I’m not looking at making much money when it’s all said and done, with an original purchase price of $85,000. I’ve learned a lot, though, and would definitely be in a spot to make much more if this same deal cropped up next week, as far as managing things much better, having a reliable contractor and plumbers lined up, etc. So yes, indeed, I’ll very likely not have much to show for all of the weekends and hours I’ve put in working on the place, and could very much view it all as a “failure” from a dollars and cents perspective of an investor.

But, in the end, I’m okay with that. There’s something to be said for giving things a whirl, instead of always sitting on the sidelines pondering giving things a whirl or chunking rocks at anyone else who dares to do the same. I’m definitely going to take a break from all things real estate for awhile, but I’m also too stubborn to just throw in the towel.

The showing for House #2 on Sunday is actually fairly encouraging, but I’m at the stage where I’m not getting excited about anything other than a signed contract. The lady is looking for a 4 bedroom in town to move her family into along with her elderly mother, who was recently imminent domained out of her house so the state can build a toll road. So coming up with a down payment apparently isn’t an issue, she’s pre-qualified and all that good stuff and seems to really like the house, and has been by three or four times asking me when I’m listing it, begging me not to sell it before then, yada yada yada. Again, we’ll see when a contract is signed, but hopefully this thing will move fairly quickly and not sit on the market for too long.

One nice thing about central Texas is that housing has remained fairly stable throughout the whole housing crisis hullabaloo, so there’s a decent chance I can get the place sold reasonably quickly, as it’s pretty hard to find 4-2s with 2000+ sq. ft. in town for less than $160,000-$170,000, so hopefully I can generate some interest by keeping it in the mid $140s. We shall see.