Flip Thy House

Bathroom of House #1

After poking around a bit, I discovered I didn’t have any before photos of the Main St. house bathroom. Boo, me. I’m not sure how that happened, as I definitely know I took some, but they didn’t seem to get filed in the appropriate electronic bin, and now I can’t locate them.

So here are some after pictures, followed by a brief description of what I did:

This’ll likely be a recurring theme as I recap all the projects with this house, but I’m really glad I spent some time there doing assorted prep work first, before launching into any major projects. This was my first pure flip that I’d tackled alone, with sole decision making powers, and a lot of the things I’d originally planned were simply overkill, and weren’t really suited to the house nor things that would make me any money.

One thing to keep in mind with any investment is that selling it for a higher price than you purchased it doesn’t mean you make money; you only profit if the sales price is higher than your original purchase price + expenses. Most of the potential profit in the Main St. house came from buying it at a substantial discount to fair market value, and not necessarily in upgrading and renovating everything in sight. After assessing things by working in the house for awhile, my goals shifted from the more grandiose plans to simpler ones: gussy up the obvious stuff, stick to stuff I can do that I know produces actual profits (paint, plants, and tile), and aim for a finished prduct that is the best 3-1 starter house on the market in my area.

As far as actual work in the bathroom, I ripped out the peeling, cracked old linoleum flooring, took out the old plastic/fiberglass pre-fab panels that were in the tub surround area, painted everything, replaced the fixture on the wall (it’s just above edge of the photos at the top), replaced the outlet by the vanity with new GFCI outlet and wallplate, replaced the hardware on all cabinets, installed backerboard and tile in the tub surround, and installed the shelf next to the medicine cabinet. (I didn’t do the installation of the vinyl flooring shown in the pictures, as that and the carpet in the back bedrooms were all done by a local flooring company.)

Sucks not having before photos, but in general it wasn’t in terrible shape, but not inviting at all, with peeling up scuffed white linoleum on the floor, pale yellow walls, and on the dingy, beaten-up side. The tub/tub surround was fairly gross, with the pre-fab panels failing and coming off the wall in a few places. The medicine cabinet was a bit awkwardly located, to the far left of the wall the vanity was on, with nothing whatsoever to the right of it to justify its location.

I was pretty happy with how everything turned out, as I feel like a got a pretty good bang for my buck. I originally planned to rip out the medicine cabinet and replace the vanity, centering everything on that wall, but ditched that plan. The medicine cabinet is original to the house (built in 1932) and kind of cool and the existing vanity is in really good shape (despite being a lower-end Home Depot mode), so I just went with them, adding the shelf to the right to try to visually balance the space. Not a perfect solution, but good enough, and a choice that saved me ~$400-$500.

Most of the work went into the tile tub surround. As far as costs, it was actually pretty affordable. The tile I used was on close-out at Home Depot, and I got it at .99/sq. ft. It was the first time I’d worked with hexagonal tile, but after a few hiccups cutting pieces for the corners and edges, it went pretty smoothly. I’m a big fan of learning how to do tile work yourself, and I think it’s pretty crucial if you want to flip houses in the current environment and actually make money. It’s definitely intimidating at first, and you should start with a project that you can take your time and screw up many times (in other words, don’t start by trying to re-tile the only bathroom in your house, or on a project with a hard deadline), but so many houses can be improved with tile, and potential buyers love it. It’s also a pricey job to hire out, but one that’s relatively straighforward for the DIYer, as all it really takes is a lot of patience and the willingness to get your hands dirty.

Everything else was pretty straightforward. I hesitate to call it “staging”, but don’t forget the small touches above. The towels, bathmat, candles, potpourri, art on the wall, soap dispenser and toothbrush holder, and shower curtain and rod all probably cost $40 total, and I’ve used them in two houses now. My goal with such things is to add a bit of color here and there, but more so to guide the imagination of potential buyers and reinforce the idea that “Hey, this is a nice little house and I could move in tomorrow and not have to do a single thing.”

As far as regrets, the only thing I wasn’t happy with is the vinyl flooring, which is a regret that applies elsewhere as well. It’s very soft and dents easily, and the transition between it and the hardwoods in the house reinforces the cheap look of the vinyl. If I could do it over again I’d still go with vinyl flooring, but choose something white and more durable.

Total costs for bathroom renovations:

Tile, grout, mortar, backerboard, soap dish: $150

Paint: $40

New light fixture: $25

Wallplate and hardware: $15

GFCI outlet: $5

Shelf for wall: $20

Flooring: (I’ll include the total flooring costs later with major projects such as roofing, furnace, flooring, etc.)

Total cost for bathroom renovations: $255

Exterior of Main St. House: Before and After

Here’s a before photo of the Main St. house, when I purchased it.

And here’s the after photo:

A few more before/afters:

Most of that’s pretty self-explanatory, so I won’t dwell too much on the work involved. It’s also not the best picture of the walkway/patio in back, as that picture was taken before it was finished and patio furniture and plants added. I pretty much did everything myself, as far as the tiling and stonework, painting, landscaping, etc. I did pay a landscaping guy we use to put the mulch in all the beds around the house, as I just ran out of time to do it myself.

As far as degree of difficulty of anyone trying this at home, it’s honestly much more sweat and labor than any skill. Even the tiling on the front porch. If you go slow, take your time, and avoid doing anything dumb, jobs like that are pretty straightforward. I decided not to paint the body of the house, as it’d been painted fairly recently, so my painting efforts were focused on the trim and doors and windows. I also stained the concrete steps in the back instead of tiling them as originally planned, mainly to just save time.

I’d originally planned to mortar down the patio stone on the front walkway and grout it, but ended up setting it in sand and using decomposed granite to sweep and work in between the stones. Grout and mortared stone looks better (to me at least) but doing it the way I did saves a ton of time, and I think it looks pretty good, especially compared to the before photos.

As far as costs, here are the approximate expenses for all the exterior work:

Slate tile: $175

Patio stone: $200

Limestone blocks: $100

Sand: $40

Decomposed granite: $30

Grout and mortar: $50

Paint: $20

Plants: $50

Mulch (plus labor): $125

Metal edging: $60

Concrete stain: $20

Miscellaneous (grout float, buckets, street numbers, paint brushes): $80

Total cost: $900

As far as things I’d do differently, goals, original plans, etc., in the end I was pretty happy with the exterior of the house. One recurring theme with this property is that while I had some grander plans before starting (adding a carport in back, possibly repainting the entire house, more formal stone walkway, more elaborate plants added in landscaping), I scaled most of them back, after getting my hands dirty working at the house and simply having more time to be realistic about things.

I did want to do a little more work in the back, as far as planting more stuff around the walkway and semi-circular patio area, but I cut those plans late in the project. While I think adding elements like that add a decent amount of value (and they’re relatively cheap), what I was really after was doing some of the visualizing work for anyone buying the house. Instead of thinking “Gee, that backyard is big, I wonder what we could do with it” it turns into “Hey, that’s a nice little patio area to sit at and chill out at after a long day of work.” Which is even more attractive if it’s your first house and you’ve been living in apartments. As far as fleshing it out with beaucoup plants, well, I’m just not sure that’d add value to a starter house like this.

Part of me wanted to get my Flip That House on, making grand, sweeping dramatic changes, but that would have been forcing things a bit. In the end, what I was working with is a 3-1 starter home on a corner lot in a good location, that was a reasonably solid rental house that just needed some polishing. So for the most part, polishing is what I did.

I think it’s a decent lesson for anyone following along at home, as in many instances you can create a pretty large impact simply by addressing all of the 187,103 things that can be easily upgraded and touched up on an older house, such as missing faceplates, mismatched hardware, paint, landscaping, etc. Add up all of those little things and voila, you suddenly have a house that gives off a much better general impression, where your eye really can’t focus and latch onto anything negative, instead of a house that in its previous condition had more than a few bumps and bruises. 

No House Work, Just Lots of Sushi

I’m currently in Los Angeles for a week, doing the freelance poker tournament reporting gig once again. It seems more than a bit surrel to be here, but not quite as strange as the World Series of Poker trip. These trips are actually a ton of work but they pay pretty well, especially since I’m using vacation time from the day job, so I’m essentially getting paid twice for my time.

The Main St. house is all done, which is a pretty good feeling. We’re listing it at $94,000, which was actually a bit under wha our realtor wanted to shoot for. Fingers crossed that it moves reasonably quickly, as it’ll eliminate a lot of worry about tackling House #2, just from a financial standpoint. I need to get over my reluctance to dip into savings, even when it all makes sense, as I still prefer to fund all this REI wheelings and dealings with pure profits, etc.

The inspection for House #2 went pretty well. I was a little worried when the city came out and checked over the electrical stuff, as far as turning on service when it changes hands, and refused to pass it due to aluminum/copper wiring present together. The home inspector I use is an electrician by trade and he wasn’t too worried by it, as it’s essentially the connections that need to be replaced, and there’s no aluminum wiring used in the house itself for any of the circuits. The furnace is shot, which I already new and had accounted for, but the roof is in decent shape, which I wasn’t sure about. Some other small stuff but nothing major at all, and the plumbing and electrical is solid, which is what was worrying me most.

Pictures of the Main St. house coming shortly (I swear). I’m probably going to break it up by area of the house, instead of creating one big honking post.

Painty McPainterton

So, knock on wood, the Main St. house appears to be done. I have a few hours of general scrubbing and cleaning tonight, as well as putting up a few more decorations for staging and moving a patio set over, but a marathon day yesterday knocked out the remaining work.

Photos coming shortly (I swear), as we’ll probably use my photos for the MLS listing, so even more motivation to provide photographic proof to back up all my babbling here.

All in all, I’m pretty happy with how it turned out. I definitely made a few mistakes that go into the column to avoid in the future, but I think I did a pretty good job of picking my battles, as far as what I focused and spent money on. Of course, the real proof will be in whether a buyer thinks that, so, you know, fingers crossed.

Have an inspection lined up for House #2, and things are already rolling on the loan front. Mortgage banker is working up a few different options, but I’m looking at something along the lines of 5% down, 7-7.5% interest rate, which isn’t spectacularly awesome but not bad for a loan for an investment property.

I’m trying not to get too far ahead of myself as far as plans for the house, as there’s definitely going to have to be some give and take, depending on estimates I get for a master suite/bath addition. That’s the big wild card, as I can ballpark most of the other expenses but I’m just not sure what to expect there. Depending on what that looks like, some things like new siding may stay or go, and I may completely replace the kitchen cabinets or try to work with the existing ones, etc.

Instead of trying to twist contractor arms to come give me an estimate before I close (and just dealing with the logistics of getting access to the house), I’m probably going to wait until I actual close, and get a chance to putter around the house some. That worked well with the Main St. house, as far as spending time there doing some initial grunt work like ripping out carpets, taking out the old ceiling tile in the kitchen, and getting the bathroom ready for tile, and getting a better feel for the house and layout before I made any bigger decisions on a few things. Regardless of any other plans, the existing bathroom has to be gutted and basically rebuilt from scratch, so I’ll likely start there, and get estimates for the larger stuff at that point.

After poking around a bit looking at what’s on the market, the unofficial, always-subject-to-change goal I’m shooting for is to be able to list it at $159,000, and to have it back on the market by November 1. Based on the above, it’s sort of silly to throw out a target for budgets and what-not, but something in the $30,000-$40,000 range would put me at $115,000-$120,000. Which would work for me, as far as potential profits. I know those aren’t eye-popping potential gains, but again, if I can do 3-4 flips like this a year, part-time, and make $10,000-$20,000 in net profit per flip, well, that’s good enough for me.

A Bad Case of JustOneMoreWeek-Itis

Despite knowing better from past experiences, once again I seem to have overestimated my ability to get the last remaining 172,192 little jobs all done to get the Main St. house ready to list. Finishing up by the beginning of August led to pushing that back a week, which brings us to the present, where it’s looking like it’ll be yet another week until I’m done, with August 20th the new target.

It’s partly my fault for jumping the gun a bit with my expectations, but it’s also that whole life thing getting in the way, too. I’m trying not to be too hard on myself for slipping deadlines, as this is still very much a part-time endeavor for me, and that’s simply going to be a fact of life if I do this stuff on the side, handling the bulk of work all by my lonesome. Yeah, it’s frustrating, as each day/week/month of delays costs me money, but we’re talking about properties on the lower end of the cost spectrum, as I’m not dealing with $750,000 houses and the attendant carrying costs.

As far as the house itself, I’m basically down to the landscaping, trim painting, switchplates and some hardware, and other odds and ends. Plus lots and lots of cleaning. Joyous times.

In more exciting news, we should be putting in an offer on another property today, assuming our realtor gets all the paperwork ready. I spent the last week or so mulling over in my head if I was up for another rehab project (and how sensible it was to take one on before getting the Main St. house sold) and the answer was a pretty solid “Yep.”

If for no other reason than I’m having fun so far, despite the long hours and aching back, and it’s work I’m good at. I just really enjoy the challenge of take whatever building blocks are available with each house and putting a combination of my personal monkey skills and money to work, mixing all of that up for maximum impact (and hopefully maximum profit).

I ended up settling on the 1900 sq. ft. 3-1, as far as the property we’re making an offer on. It’s an estate sale and apparently the heirs are getting a bit antsy, wanting to be done with it. It’s listed at $89,900 (just reduced from $99K), and we’re offering $81,500. I went back yesterday and combed over it much more thoroughly and actually ended up more excited than the first time I saw it, as the original oak hardwood floors run throughout much more of the house than I thought and are in really good shape. Ditto for the windows, which won’t have to be replaced.

More encouraging, though, was the fact that I think I can convert the existing tiny garage and attached workshop into a bedroom/bath/laundry room, at a fraction of the cost of a typical addition of that nature. The water heater is in the garage so there are already existing water supply lines there, so it should be fairly easy (or easier at least) to run the plumbing for a bathroom. The existing concrete slab foundation seems pretty solid, so I don’t think a new foundation would have to be poured.

That’d mean losing the garage but it’s really not even functional as such, due to its tiny nature, and there’s also an additional covered carport area, so there’d still be covered parking available.

The layout is pretty conducive to such plans, too, as the garage/workshop is connected to the rest of the house by a concrete patio. It’s currently open to the exterior, but it’s got a solid slab foundation and is roofed, so it’d be reasonably easy to enclose it and turn it into a sunroom, which would open into the planned addition on one side, the kitchen on another, and the main living room on the third side.

All of the above plotting would add about 800 sq. ft. onto the house, as well as a bedroom and bath, so I’d be looking at a 4-2, 2700 sq. ft. house when it was all said and done. That’d get me into the $165,000-$175,000 price range pretty easily, given the location and general local market, and that’s without a lot of higher end finishes, such as granite countertops, stainless appliances, etc. I’d still upgrade basically everything, but wouldn’t have to go high-end to get that price, as the sheer size of the house would be the main selling point.

But it does need a lot of work (aside from all the above plotting) and will most definitely soak up some cash. New siding, new roof, new furnace, you name it, it needs it. Preliminary budget I worked up (which involved a lot of guesstimation as I really don’t know what the addition might cost) is around $40,000, so even if all goes well I’m likely on looking at a profit of $25,000-$30,000 when it’s all said and done.

But, again, that ain’t bad money, especially for a part time job. And, again, I’m still having fun. So, you know, what the hell.