All Forum Posts by: Mark Parzych

I feel bad about not updated my progress. I was embarrassed about not meeting expectations.

The house is currently pending at 155k while listed at 150k. Appraisal came back at 150k so we'll see what happens. 

After my last post I still had a bunch of work that had to be done. I actually demolished the entire kitchen and bathroom floors and shower surround because the quality was so bad. I had to spend a lot of money fixing other mistakes as well from the previous contractor. The guy who I got to redo tile walked out halfway through the job so I had to find someone else to finish it up. Luckily I found a handyman who was competent and prepped it for for sale. 

I had a contract with the buyer who I originally planned to sell to but that fell through because he was too demanding. He was using FHA loan and wanted me to sign an agreement stating whatever the FHA appraisal came back as would be the purchase price for the home. I've never heard of anything like that but there were too many ways that could screw me over. Of course I said no and he walked.

I don't want to provide the MLS link in this forum until everything is complete. Anyone who's still interested in seeing the final product is welcome to private message me for it.

I'll post financials as well once its complete.

I'm halfway through my 3rd flip and a contract is pending for my 4th. Need to keep on moving and learn to be less involved as I try to complete multiple projects at the same time.

So it's been a month since my last update and honestly not much has happened. I had my business trip and everything stopped. At this stage electrical inspection has passed. I'm waiting on the plumber to finish up some stuff before he can call for a plumbing inspection.  The plumber has been very hard to get a hold of and will repeatedly say he's coming and then not show up. Then also I need HVAC to be complete which isn't a concern for me. The buyer I mentioned in a previous post is still interested in buying it, but there these extended delays are very frustrating.  I'll send pictures when it's complete. Hopefully soon.

The house is almost complete. There are some finishing touches left that should be finished by Wednesday. I'm just about ready for city inspections. 

I've selected my realtor and it's going to be listed at 149,900 at the very top of the market by $/sqft. I'm hoping to get into a multiple offer situation at this price. I won't list it before my business trip but I should be able to handle the misc. items remotely. I'm hoping to list it in 2nd week of January. 

I'm going to hold off posting any pictures until my agent takes his photos. 

I'm estimating now that my final renovation cost will be just over 65k when I had a target of 45k. I'm still anticipating over 40k net profit. 

Once everything is done I'll break down what went wrong in terms of the budget. Some extra items I didn't budget for were landscaping and building a fence/gate. 

@Sid Leibowitz

All work plumbing, electric, HVAC work must be signed off by licensed contractors. Meaning only Masters can pull permits. Some investors my allow unlicensed workers to do the work and the Master sign off to get things done cheaper, but I wouldn't feel comfortable with that. All my subcontractors were Masters, licensed, and insured. 

Now if you followed the thread, we already passed rough in inspections by the city. The rough in is basically doing all the work that can be done with walls opened up and the inspectors scrutinizing every detail of that. The plumbing and HVAC passed the first time but the electrical failed. Apparently an outlet receptacle had to be attached to the stud better or something. That was fixed and it passed the second time around with no issue. So once all rough-ins pass, work can then be ready to continue with insulation, drywall, and so on. Once everything is complete there has to be a final inspection to make sure it was finished off correctly. 

My new GC is actually a Master plumber. That's why I feel safe with him taking over the plumbing portion of the job. 

@Sid Leibowitz

I have not done a line item schedule. I can go back through my postings, pictures, and texts to do a recap of everything. All I cared in the beginning was meeting my deadline in 1st week of January. I knew it was falling behind schedule mid-way through but this new contractor put things back on track.

All that's left for inspections is final inspection for electric, gas line test, final inspection for plumbing, and final inspection for HVAC, and a final building inspection.

Because the gas meter is out, I need the gas line test inspection and passed to get the gas meter back. Then I'll have to call out HVAC for them to finish up part of their work and test it. Then call for HVAC inspection. Electric inspection can be called once electrician is done with everything so once he's done we'll call for that. Ideally all permits are closed before I list the house.

My statements above are what I believe the process is. I've actually never dealt with permits before so I may be wrong.

I'll add that a lot of thought went into the design from paint color, cabinet color, fixtures, lighting, tile, back-splash, accents, crown, etc. It's definitely going to stand out as a higher end house for the area, but in reality this verses lower end finishes are not all that difference in price. The reason is because in many remodels, people keep as much as they can to save money. There's no reason to replace functional non-dated items so the difference in cost is a lot more. For example if my kitchen faucet cost $200, and a lower grade one cost $100, my difference in cost is $100. But for someone trying to keep an existing faucet, he would pay a $200 difference in cost plus demo/uninstall labor. This concept applies to everything because everything is brand new. At some point I'll itemize all my finishings and compare to lower grade to see what this spread really is. I bet the spread between rental grade and higher end in a home like this will be less than 8k. That 8k plus a lot more will definitely be made back when selling.

End of Week 9. 

This has been an up and down experience these past 9 weeks. It's coming to a close but there are still some concerns. The plumber wasn't able to do anything today because he came too late. By the time he got there tiles were already on the ground. I'm going to have my GC finish up the plumbing work for an unknown amount. I asked him to give me a fair price and I'll see what he comes up with tomorrow. I know what this plumber gave me so it's basically a test to see how cheap or expensive he is. The reason why I'm doing this is because the plumber will be out of town all next week and I can't have him holding up the renovation.

The electric guy is so slow it's taking forever to put in light fixtures, outlets, and switches. Still going at it for the 4th night now. On top of that he's putting in the switches crooked despite many reminders to get them in better.

All the flooring should be in completely today. Both tile and laminate. Tomorrow will be spent on finishing up quarter round and baseboards, putting in plumbing fixtures, installing appliances, and finishing up shower tile. We'll try to get the plumbing inspection Monday or Tuesday. I need to wait until the gas meter is put in before getting HVAC to finish up. I also asked the GC if he knew any landscapers to make the outside look pretty. He told me I should put up a fence to enclose the backyard. I'm 50/50 on that. I'm not sure if it would get any return and it can always be a concession if a buyer really wants one. 

I'm targeting next Thursday until the house is complete. That may be aggressive due to inspections but at the very least it may be ready for pictures used for the listing. I need it ready to list by Jan 4th so it can be pending when I return from my business trip.

@Grace Jordan

Thanks for the nice words and encouragement. 

@Holly Scott

The contractor is probably going to feel like it's overkill but this is what I'd do.

 Ask the contractor for a detailed bid on all the discussions you've had. Let them spend the time to bring thought to paper. It does a few things. 

1. You will see if the contractor understood the verbal scope

2. It'll save yourself time

3. If a newbie does it wtthout enough experience things will be missed

4. It gives the contractor control--- at least temporarily.

Once everything is written down, that's when you revise it and break down the detail even further. Try to not forget anything. Then once this revision is sent back,  discussed and revised again, that's when you do your final walk through using the bid estimate line by line. During this final scope there will be additional items that pop up. Get it revised and you should be pretty much all set.

In addition have the contractor come up with a draw schedule and revise it the same way.

Now this is what I plan to do going forward. I actually have no idea if what I'm suggesting is normal or not.  I'm a detailed guy by nature but my goal would be to systemetize once I find a dependable contractor who I can use multiple times.

@Julie Marquez

So today was mostly cabinet install. They're almost done with all the door and trim painting. They started on the shower but will need to float the wall slightly to make it even. We are ready for granite tomorrow. My plumber finally came and connected the gas line in the yard. He should be back installing plumbing fixtures and attaching the appliances Thursday. The electrician is there tonight working to finish up everything but I don't know if he can get it all done. At least he seems committed to it now. I talked with HVAC and they are scheduled to come Monday.

My new contractor is a GC but I'm basically the GC lining up everyone. I decided to use the existing subcontractors partially because they appeared to be doing good work and also because there were balances from the old GC. I didn't want to risk leans getting put on the house. It's definitely something I can do, but without dependable subcontractors I don't think it's feasible since I can only be on site once a day after work.  

I did an estimate on my costs and it appears that I'll be into the project for around 62.5k which is well over my target of 45k. 

The items that are running me over are: 

2200 - Gas line outside

2200 - Balances on subcontractors

350 - Not being able to use the "cheap" tile I purchased for kitchen and bathroom floor

500 - Higher than expected on flooring materials budget

7000 - Draw to GC with no work to show for it

3250 - Over on Fixtures+Appliances. I "Budgeted" 4000 for this and it's well over. Something that I didn't include originally that I ended up purchasing is a washer/dryer which was around 1100-1200 alone. That 4000 Budget was just a wild guess but after doing a little research later on I realized it wasn't realistic.

So that right there is 15,500 in overages. There's going to be extra cost because of switching GCs but honestly I'm almost glad in a way because these guys are doing great. They have been on schedule every day and are doing quality work. There is no way we would have finished on time with the other guy. 

After some internal and external discussion, I think I am going to sell it. I'm going to try and come up with a business strategy that works for me and follow though on that. I've been sort of winging it in terms of which houses I buy and what direction I've gone in. That was to learn, gain experience, and figure out what works best for me and I'm ready to move on with a concrete game-plan.

Something that bothers me a little is that my paint color choice looks great in the brighter light but not as good in the yellower light. 

@Holly Scott

The only thing I can say is make sure every little thing is in writing. If he's buying materials and you expect a certain quality state that quality. If he's painting state in the contract paint color to be chosen by homeowner. If you want a certain detail with tile state that detail. Basically every single thing that can be thought of should be in the contract. That's how I'm going to do it from now on. I'm not an expert and I'll miss some items, but each house I do will give me more experience on how to scope a project. I don't have a template to share. I may think about making one in the future but templates can only do so much since each house has its own uniqueness that templates don't cover.