Second Flip Journal Part III

Day 0: Whhhhhoooo closing went well! We received confirmation the previous homeowner took the two large items that were present during the walk-through. So we officially have a blank slate to start this project. And without further ado, here is a picture of the house:

Doesn't look like your average flip does it? We were having problems with finding the “perfect” flip, and for several months we kept missing out on the house by being outbid, late to discover the house, or just not even aware the house was available. We decided to take a new approach. We looked for houses that were sitting on the market for a while, appeared to need minimal work, and investigated further why they were not selling. This particular house had an offer when it first hit the market, but then when the septic failed, the house was listed back on the market with a significant price reduction. As it was not being marketed to investors, and instead to primary residents, we believed it to be a perfect house for us. Why? Because most people who purchase a home at this price point need a mortgage, and most lenders will not lend on a failed septic. But that is not even the best part of this story! When we learned of this, we submitted an offer far below asking. Despite going back and forth with the homeowner, we could not reach an agreement. The house then sat for another month on the market. We asked our Real Estate Agent to touch base with the homeowner's Real Estate Agent again, and we learned the homeowner might come down in price. So we started negotiations again. During the negotiations, we found out the homeowner had the septic issues fixed, and it now PASSES!!! This was fantastic news to us, and allowed us to come up in our price (as we no longer needed to factor in the septic repair into our renovation) showing the homeowner that we were being flexible too. Here is now the best part; they never updated the listing to reflect the fixed septic issues. Thus, no one knew they now could get a mortgage on the house! There was only one other person who put in an offer, and with our ability to close quickly we were able to secure the house! A few more updates before I close out this entry... First, PM went to two granite places and looked at the options for the Kitchen Countertops. Second, I customized the Independent Contractor's Agreement (ICA) and Sub Check-list for our first Sub, who is coming tomorrow to start demo. I also created a Payment Tracker document to track all Subs payments in one location, so we don't have to keep referring back to the ICA for amounts and conditions of payment. And I finished setting up all utilities, including insurance. The only two items left is getting another fill-up of propane for the tank, and we are going to hook up internet at the house. PM and I do almost all of our calls via FaceTime (so I can see what is going on), and cell reception is terrible at the house, so the internet hook-up is a must!

Day 1: Demo started early this morning! The only thing left to demo is to pull the carpet up in the basement. However, we had a little hick-up with the dumpster. The dumpster was supposed to arrive at 9:00am, but didn't arrive until 1:30pm. Further when it did arrive, I ordered the wrong size. I ordered a 40 yard, which wouldn't be that bad (considering it is always better to order bigger), but the sides were over 8ft tall! Which would have been very time consuming to actually put the trash in the dumpster! They took it back ,and replaced it with a 30 yard. While this hick-up caused a delay of the trash actually getting in the dumpster, the good news is we saved $100 by getting the smaller size....you have to keep looking for the positive in this business! PM and I had a few calls during the day. During the calls we confirmed the granite for the kitchen, however we still are working out the configuration of the kitchen. It needs to be decided shortly, as several tasks are depending on the configuration. The priority now is getting the flooring for the bathrooms. In order to do that we have to pick out the vanities, as it all needs to tie-in together. Did I mention how much I hate, wait scratch that, loath vanities!?!?!? Someone needs to come to come up with a store that just sells vanities. It would have mix and match bases and mix and match tops, with 20 color options for both, and different style handles. It could be made while you wait, or shipped the same day for free. The store would also sell the complimentary flooring, and have pictures of your combination with the different floor options. This way color matching between vanities, and flooring is not such a risk. And whoever is reading this thinking this is a great business idea, would forever give me 50% off instead of a royalty fee.

Day 2: Floor guys came today. They started sanding all of the engineered hardwood to prep for the refinishing. PM and I spoke again about the kitchen and master bath configuration/finishes. For the kitchen, the configuration is the concern. The current configuration has a 27” wall oven-microwave combination in black. All of the other appliances are stainless and the ARV cliental will expect stainless. Here's the problem. Wall oven-microwave in stainless are expensive (about $2,000 to start). While a standalone is way less, they are not made with a 27” width (they start at 30”). Solution, we had to reconfigure the cabinets to find the room for the standalone to fit. The new problem this creates is finding new cabinets that match the existing cabinets, and are available quickly (in order for the doors to be stained by the painters). Sounds like a headache for PM to worry about! Today we also ordered the main bath vanity, however we are waiting on getting the flooring, as the main bath vanity is featured at a few different stores and the color varies slightly. As we want the floor to compliment the vanity, we want to be 100% certain of the vanity color prior to installing the bathroom floor. We can decide later as the vanity is scheduled to arrive by mid-February. Just one more reason why having the mix-and-match vanity store would be such a great idea! (Read yesterday's post if you don't know what I am talking about).

Day 3: We decided at the beginning of this project, the target audience for this house is my Mom (PM's wife). Which makes sense as this house looks exactly like my parents' house. We decided to leverage this by seeking my Mom's approval for each design element. Which brings us to the master bath. While I hate vanities, I am sure PM hates master baths. In the past 24 hours, I have changed the design three, wait, four times! In fact last call he said, “I don't care what we do, just pick something!” Here is where my uncertainty began: I had an idea for an expresso and cream colored bathroom and showed it to my Mom. And she said, “It is not what I would have picked, but if I walked in and saw it I would like it”. With that small comment, I started coming up with alternatives. I sent a few options to PM, and while PM and my Mom were having breakfast this morning, they ranked the ideas with the original idea at number one. With that confirmation, I ordered the master bath vanity. Sooooo, hold on to your hats, we are going with the brown and cream option! I am still a little nervous about this, but I know it will be more unique than the Calcutta, grey and white bathroom that everyone is doing right now (not ripping on it as we did it on our last house). PM investigated the kitchen a bit further, and discovered there is a gas line already in for the new oven location! When PM told me this, I said, “This is a good thing, right?” and he replied, “If you like saving money!” And that right there folks is why we get along so well! PM also has the cabinet figuration sorted out, and made a call to a cabinet maker to identify where they can be made. PM also called the company who made the shower fixtures in the master bath. I forgot to mention this previously, however, instead of replacing the entire faucets, we are just switching out the exterior parts. Not only will this take less time to complete, but it will save money while giving an updated look to both the shower and the tub. While things seem to be going very well, there was a bit of bad news concerning scheduling. When we originally spoke to the floor guys, they confirmed that we could work in parallel while the floors were being done. Apparently that translated to only two days (while they were sanding). Tomorrow they start staining, and they don't want anyone in the house until mid-week next week! Fortunately, we have the time, but lesson learned we really should have gone day-by-day with them to confirm which days we could and could not be in the house. This is not welcome news, as we just purchased all of the tiling supplies for the tile guys to get started tomorrow on the tiling, which will now be postponed until next week. Fortunately, they completed all of the sheetrock today in the main bath, and some in the master.

Day 4: With the floor guys needing the house to themselves, PM and I had a long call this morning to work out a few more design elements. To start, my Mom actually found a chandelier she liked for the interior which I was able to find for almost $90 cheaper online. (I am starting to think I should write an article on how to save money when flipping, or renting...I am like the crazy coupon lady of house flipping!) The granite company wants the appliances in prior to taking their measurements (which was not the case with the last granite company we worked with; PM is going to call to verify that is truly a necessary step). PM and I also looked at appliances online, and he was going to go look at a few appliances later in the day. After our call, and PM running a few errands for the house, he went to the house and checked on the floor guys. Here is a picture of the floor stain; it is the darkest we can go. While I am a bit skeptical about the color, I think once the whole house is completed and the floor has polyurethane on it, it will look good.

Day 5: I am starting to think my Mom should be on payroll for this house! Today my Mom went to a granite store, and found a granite option for $500 less than what we originally selected. The color is a bit different than the one we initially chose. Before making a final decision, PM is going to put the two granite options next to the color of the cabinets, wall color, and backsplash. PM also spoke again to the cabinet company, and while they do not make the cabinets we need, they believe they know who does. PM has to call back on Monday to get more information. PM and my Mom also went to check on the house today. It appears the floor guys did not show up! PM called the floor contact multiple times, but did not get a call back. On Monday he is going to have a conversation with the floor company, and explain if people are not coming on certain days, he needs to bring other guys in to keep the house moving. While at the house, he tested a sample for the stair railing, and applied a second coat of stain on the floors on a hidden area. The floors look better with a second coat. We are going to ask about the cost/time of applying a second coat of stain and make a determination.