Mid Century Modern Reno Part 3

It's been awhile since I posted but this reno project is chugging along!  At the end of part 2 I promised to talk about the numbers in part 3.  I shot a video that was 10x as boring as my normal videos so I'm not going to burden you with that!  Instead, I'm going to give you a quick rundown of the numbers as well as some updated pics of the reno in progress!

I came across the sellers of this property while working on the Forest Hills Investment Project.  We were wrapping up the renovation and they lived on an ajacent street that partially backed up to the property.  They were out in their backyard one day and they commented about how thankful they were for the great work we had done to cleanup the yard and that they were sure if we did anything remotely as good on the inside that it would be a great house.  They then mentioned that they had a home they were looking to sell and had just fired their realtor.  I asked for the address of the home which they gave and told them I would look up the withdrawn listing and check it out.

The old listing didn't give me much of anything to go on; there were 2 thumbnail pics and a lot of information that didn't match the tax records.  I saw the home was listed for a price of 150k and upon doing the comps I ascertained that would be a fair price if the home was in good shape and modernized.  We set an appt. for me to see the home and at this point, I was looking more towards getting the listing as their agent and marketing the property properly to get it sold than in buying.  I set an appt. to see the home and it was very interesting.  It was what many would call a "Time Capsule" home.  Built in 1961, everything in the home was original!  (I won't elaborate here, you can go see for yourself in the Part 1 video).

It was immediately clear, why the home didn't sell the first time around or even get offers.  The location, while safe and zoned for good schools, has several homes that are a bit more rundown and without an HOA, there is no uniformity or anyone enforcing maintenance on the exterior of the homes.  The other big issue is that a home of it's size is normally considered a "starter home" and while it was certainly in liveable condition, modern buyers would want it updated and most first time buyers that this home would appeal to probably wouldn't have the 30k needed to get it updated.  The other audience for a home like this is investors like myself and since we are interested not in living in the home but in making a profit, we need to get it at a good price to make it worth while.

In the end, I discussed 3 options with them:

1.  Re-list the property at 130k. I pulled comps and included several full color pictures from the comps MLS listings to really drive the point home. I would put a proper marketing plan in place including professional photos and CORRECT data about the home in the MLS.  They could expect the home to sell between 120-130k and the timeline as to when that would happen would still be a bit unknown and with the amount of work the home would need, it would be possible that a price reduction further would be needed.  After closing costs, they could expect to net around 110-115k.

2.  I personally would offer to buy the home for 90k cash with a 21 day closing.  Because I am personally buying the home myself, they won't be paying realtor commissions which just leaves normal closing costs of Title insurance, tax proration, etc.  They would net appx 87k, a far cry from 115k but virtually guaranteed cash in hand in 3 weeks.

3.  I personally would offer to buy the home for 100k cash with a 21 day closing if they OWNER FINANCE it to me.  Since they own the home free and clear they can "hold the note".  In scenario 2, I would be paying "cash" to close however, I would really be using creative financing methods aka "Hard Money" to get the cash and there are some high fees.  If they wanted to net more money, they could essentially be the bank.  This scenario would allow me to get the home renovated so then I could do a Cash out Refinance with a conventional bank at a low interest rate and pay them off the balance.  They could expect to net closer to 97k in this scenario.

In the end, the money wasn't that important to this couple.  The home had become a BURDEN.  They are in there "golden years".  The home was COSTING them money via insurance, lawn maintenance, taxes, etc.  Worrying about a vacant house was also stressful.  They own their personal home outright, they have no bills, they could use the money sure but they had no compelling need to get top dollar.  We negotiated 95k cash.  They were close to doing the owner finance but the reality is that if for some reason I defaulted on the payments, they would have to foreclose on me and they would get the house back and that was the last thing they wanted!  They wanted it gone for good!  So we met in the middle at 95k cash and everyone is happy.  They got a major stress relieved and a very nice check.  I got a great property, at a great price with room to make the improvements needed and still turn a nice profit.  When it's done, this house will be a step in the right direction for improving the neighborhood.  Already it's amazing seeing other neighbors start doing a little more maintenance to their homes as they see you cleaning up a property.

There are many ways to be creative in investing in real estate.  This deal just shows one of them.  Understand your sellers needs, the emotional triggers, and don't do a deal just to do a deal; it's got to be a win-win.

Now your reward for getting through all of that is you get to see some cool pics of how we are progressing with the reno!

Needed a way to get rid of the overgrowth.  Rented a chipper and made enough mulch for 2 of my properties!

Teaching the youth about hardwork and real estate investing!

NOW THATS A FIRE!!!

When your roasting hot dogs on a fire that large, you gotta have a long stick!

Overgrowth almost all gone!

Grilling with the crew after a long day of work

Yum!

Father in law is a HUGE Colts fan and we found this in an old storage shed.  This isn't a throwback, it's an original!

I love it when the neighbors stop by!

Refinished terrazzo, fresh paint, and new modern fan.  just waiting on special order windows

Robert has made this project!  You have to see the refinished terrazzo in person to truly appreciate it's beauty.  It makes the house!

Replacement Hurricane impact window in addition will add beauty, efficiency and safety. 

new 12k BTU AC with heat pump installed in the addition

Quick and easy curb appeal boost

Stay tuned as we make the push towards the finish!

Mid Century Modern to New Century Modern Pt. 2

In part 2 of our latest renovation project we take a look at the addition and all the options that it presents for the property.  The 3 bed 2 bath 1100 sq ft main house is in excellent shape just needing cosmetic updating. 95k would be a reasonable price for just that unit alone.  But this property just gets better and better! There is a 675 sq ft addition that was very well constructed.  It was permitted as a finished porch presumably because it doesn't have a central AC unit installed.  A little bit of flooring and replacing of paneling with drywall will make this an incredible space and add a ton of value to the home.  Last but not least, it's on a waterfront conservation lot.  Take a look at the video and see all the potential that this home has.

Upcoming investment project: Mid Century Modern to New Century Modern

I'm back at it again!  While we are putting the wraps on Jon and Kindra's reality home (final finished product to be shown here soon!) we decided to pick up another investment property.  This is an old mid century modern design in a B- neighborhood that is just crying out to made amazing again.  The home was inherited by a couple in their late 70's and they have no use for the home.  They don't want to live in it, they don't have any family that wants to live in it, they don't want to be landlords and rent it out themselves, they just want to be free of the property.  They have been paying insurance, yard maintenance, and taxes on it for the past year and had listed it with an agent who was less than stellar and overpriced the home.  I met them while finishing up our Forest Hills investment property and things took off quickly.  What went from me auditioning to simply list the property for them turned into me making a cash offer to take it off their hands in short order.  We will be closing in a couple of weeks.

Some facts about the home.  Main house is a 3bd 2ba 1100 sq ft with a carport.  2 permitted additions were done that add another 675 sq ft in the back.  The possibilities are endless as the back unit could easily be turned into an attached 1/1 inlaw suite or integrated into the main house to make a large 4/2 or 4/3 1775 sq ft house.  The house was immacutlately maintained but never updated so it's like taking a trip to "Grandma's House".  We have a lot of decisions to make regarding the renovation but I want to preserve as much of the original mid century style while simply modernizing with latest and greatest appliances and amenities.

As for the neighborhood, I call it a B- neighborhood because its an area of smaller homes that didn't have too many updates and you can tell it was hit hard by the foreclosure crisis of 07-10.  It's a perfectly safe neighborhood it just has homes that are in need of updating and it's finally starting to happen as the rest of the surrounding areas have already been improved or never really went downhill.  The best part is that in spite of the immediate area being a little more rundown than desireable, it's still in an area that is zoned for very good schools so this will surely attract plenty of prospective renters or buyers should we choose to sell.

Original birch cabinets with legs are a classic

putting new counter tops and modern appliances could really bring these old cabinets back to life

Green bathroom is probably a little too vintage the vanity and the medicine cabinet could be cleaned up and tied into the mid century design

Just isn't mid century if we don't have pink!

Beautiful terrazo floors, high ceilings and huge windows

Addition waiting to be brought to life

Addition waiting to be brought into the 21st century

Reality Home Pt 2 - The Rebuild

It's been a very busy few weeks here in Tampa.  We had 2.5 weeks of unprecendented monsoon rains that really put a lot of delays on several projects.  The sun is back out and we are moving along so it's time to catch up with my friends Jon and Kindra and see how their "reality home" renovation is coming along.

This home is a 2400 sq ft 3 bed 2 ba 2 car garage pool home in the Lake Magdalene section of Tampa.  It also has an enclosed sunroom that represents about another 300 sq ft.  It was built in 1978 which is older by Florida standards but all things considered still a very modern home.  PVC and Copper plumbing, no lead paint or asbestos issues, etc.  These older homes are popular because they sit on much larger lots than modern day new construction subdivisions.  Lets take a look at the before pics.

Beautiful mature trees and landscaping

A well cared for but HIDEOUS kitchen.  The cabinets appear to be the original ones just repainted numerous times.  Notice the soffit all around the kitchen.

another view of the kitchen, the french door fridge is great except that the bottom freezer opens up right into the peninsula!

Living room with blue gray slate tile and popcorn ceiling!

View from the living room into the sunroom.  Sunroom was created within the last 10 years and was constructed fairly well.

sunroom

Pool and backyard landscaping

Huge backyard

Laminate flooring in the bedrooms and office areas.

This home was listed at 249k which quite frankly was a pretty solid price.  It's not the most stylish home but the laminate flooring was newer and in great shape, the square footage is tremendous and it has a pool and big well landscaped yard.  To be under $100 a sq foot is a steal.  The problem this house had is that buyers looking at homes of this size are really looking at a home they are going to live in for the long haul and they want it to be beautiful, not mediocre.  Buyers in this neighborhood generally aren't willing to do the work involved in updating a home despite the fact that they may be able to afford to.   

Insert Jon and Kindra.  In true HGTV Property Brothers type fashion, they understood that they would get far more long term value plus the ability to customize to exactly what their tastes are if they bought a fixer upper rather than inheriting someone elses style (or lack thereof).

Chip and Hammering up the Tile

The kitchen is no match for teenage angst!

Pups want in on the fun!

Scraping 2400 sq ft of popcorn ceiling!

Bye Bye Soffits, Hello Pot lights!

Opening up a pass thru from the foyer to the kitchen

relocating the water line to make the kitchen larger and flow better

New Floor tile has arrived!

Bowser the Pug says "If you won't let me inside to do demo, I'm gonna demo the entire back yard"

Stay tuned! There is lots more to come as this reno kicks into high gear!

Product review: Beating the heat

I live in an older home (by Florida standards at least, it was built in 1980!) that has an aluminum roofed lanai that does not have any insulation on it.  Overall, the lanai is great; it provides plenty of shade and since it has the aluminum roof vs a screened roof, I can still use my grill and stay dry when it's raining.  The problem is that the roof takes on so much direct sunlight that it gets extrememly hot and heats up the entire lanai space rendering it unusable on the nicer sunny days.  I've been looking for a solution and I think I may have found it.

Gardner STA-KOOL is an elastomeric roof paint that is supposed to reflect the suns rays.  Elastomeric paints have a greater degree of elasticity and they can also help to seal up leaks.  My lanai has a couple of small of leaks in it as well so hopefully it will take care of those problems.   The instructions say that you need to put 2 coats of this paint on and it is so thick that a gallon doesn't cover a whole lot.  I used a 3/4" nap roller since the paint was so think (normal paint rollers are 3/8) and rolled it on after powerwashing the roof the night before.  I was able to do one full coat on the roof and then I decided that I would do the underside aka ceiling just to brighten it up.  I was able to get about half of the ceiling done.  After painting, I waited for the middle of the day when the sun was at it's highest to check temperatures on the roof.  I left one small section unpainted to use for comparison sake.  Results are pictured below.

Unpainted roof section

painted roof section

So far so good!  That is a 25degree temp difference.  In the past, when I walked out into the lanai, I could really feel serious heat radiating down from the ceiling, now it doesn't seem nearly as bad.  Keep in mind, this is also after just one coat.  I will be going ahead with the 2nd coat and testing again along with seeing if it solved my leak problem!  Stay tuned!

Forest Hills Investment Project Update

RAIN RAIN GO AWAY!

Seems like it just wont stop raining here in Tampa, it's been going for 2 weeks straight!  Normally in rainy season we just have 30 minutes to an hour of rain in the late afternoon 4-5 days a week.  The past 2 weeks have had rain off and on all day long.  lots of flooding and lots of lost productivity, particularly on a house that needs a LOT of yardwork done.  It's a shame we didn't get the sod laid 2 weeks ago, we wouldn't have had to use a drop of city water to irrigate it.

Fortunately, we have plenty of work to do on the inside of this property too!  Check out the open concept updates and the bathroom renovations below and stay tuned to see the kitchen and yard transformations!

Original living room

Wall blown open

View from kitchen

Elio and Gilberto tearing up the bathrooms!

Selfie with Armando the Electrician

Master shower prepped for tile

Master shower in progress

Master Shower complete

Master shower floor tile

Master shower

main bath demoed

Main bath complete

great product to add privacy to the bathroom window instead of ordering custom frosted glass

Gutters and brick painted back to white