Cat Litter House: Flip # 653 and it could be the worst one yet. Look at the pics and you decide.

[Brian Burke]

Some flips are easy...paint, carpet, clean, and list.  Then there are the hard ones. 

I've never posted a diary of a flip before.  With over 600 flips under my belt I sometimes think that I've seen it all.  Then I see something I haven't seen before.  This time, It's so outrageous that I couldn't resist sharing.  I'll share the visuals, but fortunately for you I can't share the smells.  This is kind of a diary and kind of not...I bought it in January so you don't get the day-by-day play-by-play, but it's not done yet so this isn't old news either.

I came across this deal from a wholesaler who I met on BP (thanks yet again BP for making me money).  He hadn't seen the house in person but he had heard it was in bad shape.

I sent my acquisitions guy down there to look at the house. When he came back he said, "that's the worst house I've ever seen." At first I thought "Come on, really? You've looked at over a thousand houses for me!" Ultimately, I took his word for it. We threw a number at the rehab and ARV and made an offer. It was accepted.

Here are the numbers:

ARV $400,000 (probably a little more, I hope)

Rehab $175,000 (probably a little less, I hope)

Since there were some unknowns I had to make a conservative offer.  It would take a while to fix this place up, so I had to add some margin to cover the carrying costs. 

My offer: $125,000.

Closing was about a month later.  The seller agreed to move out and leave the key at the title company.  On move-out day, I went down to the house to see it for myself for the first time.  When I opened the front door, this is what I saw.

Ok, so now I knew that my acquisitions guy was right!  We were in for it!

Have you ever seen anything like it?  Wait, it gets worse.  More to follow!

[Brian Burke]

@Account Closed I have one offer already, it came in a couple of hours ago.  :)

[Account Closed]

This is one of the best threads I have ever read.  I had to show my wife just now and she could not believe the pictures.

What sort of disclosure did you make to potential buyers if any about the state of the house previously?

[Douglas Larson]

Wow!... best flip ever!

[Chris Vail]

@Brian Burke 

Thank you for sharing your journey, this thread has been fantastic.  You will deserve the profit that you pull down with this deal.  Talk about seeing the forest through the trees, awesome job.

[Brian Burke]

@Account Closed No disclosure yet...I just got my first offer today.  In conjunction with the response to any offer, I'll include a photo collage of the before pictures.  My transfer disclosure statement will also include language about the former condition, what was done, etc.

Sellers are required to disclose all known defects.  In a typical flip, most or all known defects are corrected during rehab, so I normally don't go into much detail on a property's "before rehab" condition, but this one is a special case.  I'd rather have a buyer walk away now than find out from neighbors after COE...

[Rich Cee]

Burke, you deserve the profit brother. Lemon's into Lemonade? Try poop into a Corona!!! Great job!

[Charmaine M.]

Brian, i just want to thank you for keeping me motivated, inspired and determined.

My market is very difficult to get into when you are newbie, but this post keeps me moving along when i get discourage.

Great work and many more success!!!

[Account Closed]

@Brian:  when you have time, I have rehab questions. I'm always on the look out for when economy and goof taste come together, so I'm looking at it with a totally different eye than your buyer.

 Is the flooring product on the main floor engineered wood flooring, or laminate?  The listing says laminate, but it looks better than laminate in the pictures.

Where's the utility/laundry area in this house?  I'm familiar with the house layout as there's a subdivision in one of my farms with same houses built 1976 - 1982. The laundry closet has been near or under the stairs.  Is there a utility area, or are the hookups in the garage?

Is the 4th bedroom an office off the family room area?

What was the thinking behind the double door entry to the master bedroom?  Was it that way already?

Is the back patio poured, or is that just block set on top of sand or dg to suggest patio?

[Gil Lieblich]

Really amazing job... love the transformation. Looking forward to seeing all the numbers and break down so i can have a better understanding of what to expect if i ever get to tackle a situation like this.

[Aly W.]

Excellent work, what a project! All the best!

[Bob E.]

And to think I was in a licensing class a few months ago where they mentioned that hoarders are now protected under ADA.

[Joe Demonte]

Fantastic job, @Brian Burke . You deserve a round of applause with taking this project on. I wish you the best from it, and thank you for sharing with the BP community!

Its a great record kept for a seasoned real estate investor like yourself. 

[Joe Demonte]

Double post... Cant delete 
:(

[Brian Burke]

Originally posted by @Account Closed:

@Brian:  when you have time, I have rehab questions. I'm always on the look out for when economy and goof taste come together, so I'm looking at it with a totally different eye than your buyer.

 Is the flooring product on the main floor engineered wood flooring, or laminate?  The listing says laminate, but it looks better than laminate in the pictures.

Where's the utility/laundry area in this house?  I'm familiar with the house layout as there's a subdivision in one of my farms with same houses built 1976 - 1982. The laundry closet has been near or under the stairs.  Is there a utility area, or are the hookups in the garage?

Is the 4th bedroom an office off the family room area?

What was the thinking behind the double door entry to the master bedroom?  Was it that way already?

Is the back patio poured, or is that just block set on top of sand or dg to suggest patio?

The flooring is laminate, but I agree that it looks like engineered hardwood.  It's just really good laminate, and it's really inexpensive.  Well, we just negotiated a really good deal on it, I guess volume counts for something.

Laundry room is between the family room and the garage.  It's adjacent to the downstairs half bath, which is adjacent to the staircase.

The fourth bedroom is really a den or office.  Originally it was part of the master bedroom as a sitting room.  This floor plan was originally built as a flex plan with a builder option of master with a sitting room or 4th bedroom.  Looking at the market, I noticed that there were very few 4-bedrooms on the market so it seemed the way to go.  Putting up one wall gives the 4th bedroom, but it's too small to put in a closet.  So it's a den.  But it's now downstairs by the family room, it's upstairs.

The double-door entry to the master was an existing design.  While the doors are new, the opening isn't.

The back patio is pavers on sand.  This allows flexibility if the new owners wanted to tear it out and do a deck or something different.

[Sheena Breedlove]

I can't wait to see what you do with this place!!

[Robert G.]

Wow.  Excellent, Brian.  Really enjoyed following along, thanks for sharing.  And good luck with the sale!

[Mike Clark]

Finally the before and after pics ...trying to finish my rehab without constantly thinking about your rehab  was an exercise in patience.  Your before and after  pics are incredible...I got an idea why don't  you find another monstrosity and start a new thread

Congrats

[David Niles]

Holy crap Brian, spider webs look like those fake ones you buy for Halloween. lmao.

While I havent had that much debris like this before, I have had a cat pee house that would knock your nose off.  Lots of demo and Kilz oil FTW.  

Good luck, shes an ambitious one thats for sure. 

[Sonja Pope]

What a flip! Congrats to @Brian Burke  on a job well done! So glad I discovered this thread after the "after" pics were posted. I would not have been able to handle the anticipation, LOL!

Looking forward to seeing your next success!

[Account Closed]

Originally posted by @Brian Burke:

Thanks for all the additional info.  The laminate looks really great.  I'm not familiar with good laminate and have never even considered it. I really like the color and texture.

I was wondering if the pavers on sand were more staging than landscaping, but wasn't sure.  Given the level of the patio door, a deck makes sense. But let the new owners build it!

The double door master bedroom entry is not something I've seen before in that style/age CA house.  IMO you did the right thing to work with the existing frame opening and replace the doors.  But it's so weirdly useless.  Like so much from the 80s. :)

Any more offers come in today?

[Cathy McCormick]

I just listened to the podcast, and I had to check out your pictures. They are unbelievable! I can't wait to see the after photos!

[Larmon Cummings Jr]

That was interesting...look forward to the updates as you fix it up.

[Brian Burke]

Originally posted by @David Niles:

Holy crap Brian, spider webs look like those fake ones you buy for Halloween. lmao. 

That's hilarious, I said the same exact thing! 

[Brant Richardson]

I would love to know how many bags of cat litter it took to fill the house.  They probably could have made the place beautiful for the cost of the cat litter.  Junior grew up so happy there, the whole house was a sand box.

Amazing job.  My wife laughs at the pictures of houses I am interested in and says "that's a tear down".  I'll have to show her your before and after photos.  Thanks for sharing it.

[Brian Burke]

Yes, we've had two total so far.  I made a really onerous looking pictorial exhibit plus an extensive disclosure statement. Sending that out to buyers once they submit an offer. Both retracted their offer.  Not unexpected that this would happen, but I only want to sell to someone that fully understands what they are buying.  The right buyer will come along.