Tales from a Flip – My Experience Rehabbing a House
I had looked at several homes that were vacant bank owned properties. Most of the properties were money pits, but I did find one that seemed just right. When I walked in the door, the first thing I noticed was the odor. There obviously had been pets in the house, and the carpet reeked of urine. Many of the previous owner’s belongings were still in the property. The kitchen still had food, wine bottles and other things in it. Over all, the bones of the property were good, the house was pretty square, and all the original wood trim in place. It really needed a good scrubbing and updating. I knew I had a gem on my hands.
After estimating what repair costs would be and what the house could sell for after rehab, I came up with my asking price. So, I put my offer in. I wasn’t sure how a bank would react to an offer, I was expecting an outright ‘no’, since the property was just listed, and my offer was lower than the list price (which actually was somewhat reasonable). After a counter offer, we settled and I was pleased. We had hoped for a quick close, but I was obtaining my financing right about the time when the mortgage industry began having problems, so there was extra red tape to go through (this is a whole other story in itself). It ended up taking a full 60 days to close without a minute to spare.
The plan was to do the majority of the work myself, with the exception of some plumbing/electrical and the roof. I had planned my budget accordingly. After watching all of those ‘flip’ shows, I realized that sticking to my budget was going to be priority number one.
I still laugh when I think about the first item I bought to start work on the house: wallpaper remover! This house was covered in wallpaper from top to bottom. It took days to remove all of it. There was even wallpaper behind the shower surround!
Demo was kind of fun, although very dirty. When we pulled the carpets up, there was hardwood underneath! That was an exciting find. We also found hardwood floors underneath the ceramic tile in the dining room. I couldn’t believe my luck – and that the previous owners had covered the floors up. The kitchen and bathroom required everything to be removed (except the bathtub). There also was a toilet installed in the kitchen pantry that contributed to the smell in the house. You definitely need a strong stomach for rehab work.
After removing all the wallpaper and giving the house a good scrubbing, it already seemed so much better. Next began the weeks long project of painting. I chose neutral colors for the walls with white trim. Painting all of the trim in the house took the longest, longer than I anticipated. There isn’t any easy way to paint trim when it is different than the wall color. But the final product turned out great.
One reason to do painting before your flooring – I managed to drop a gallon of ceiling paint on the floor! Ooops. So glad I hadn’t refinished the floors yet.
The bathroom needed a full paint job, new tile floor, tub surround and fixtures. The tub was cast iron and in good shape, except for the finish -so I decided to have the tub reglazed. It turned out great! I had originally wanted to tile the shower surround, but I had to find room in the budget to account for the extra cost of the roof. So I put up a fiberglass surround.
Note to flippers – make sure you have wiggle room in the budget for unexpected costs. The roof was $1000 more than expected, so I had to move numbers around to accomodate that.
The kitchen required plumbing to be installed for a dishwasher, and several electrical outlets. The original placement of the refrigerator was out in the back hallway, but I decided to sacrifice some counter space to bring it into the room. The kitchen received new paint, vinyl tile floor, new cabinets and new appliances.
Then came the hardwood floor refinishing. Part of the learning aspect of this house was learning what I can’t (or won’t) do on the next project. Sanding floors is one of them. This was really a giant job to attempt for the first time, as there were five rooms to refinish, plus a hallway. After repeated attempts with a sander, I finally gave up and called a flooring company to sand the floors for me. They did all the floors in two days, and then I put down the polyeurathane. The floors came out beautifully! They really were a great selling point for the house.
The rehab for this house took almost 90 days to complete. In the end, I was surprised at how many of the things I could actually do myself – which saved me a lot of money in contractor fees. I also learned what things are better left to professionals. This house is now under contract with the closing coming up soon. The key in these softer market times is to price the home right. My realtor and I looked at comparable homes on the market, and those that sold to come up with a price that led to a quick sale.
After all closing and holding costs are paid, I should end up with a profit of roughly fifteen thousand dollars, which was pretty close to what my numbers said. All in all, it was a good experience, and one that I will surely do again.
