I used a template from JScott over at www.123flip.com.  Its very useful for gathering numbers.  We went about 20% over budget. To be expected for first timers. We will certainly nail it down better on the next one. Overall I’m very pleased with the outcome.

Based on local comps, the house is conservatively worth $270,000 and could likely pull $300,000 based on a recent sale of a 4200 sq ft home in the area for $320,000.  Our house is 3900 sq ft (3500 finished).  Based on my calculations, if we sold today, the conservative profit would be $7000 and high end would be $30,000.  We will likely be in this home for 4-6+ years through.  Not bad for our first full rehab.

That’s all for now.  I leave you with this quote “Everybody’s a self-made man; but only the successful ones are ever willing to admit it.” Anonymous

edit: for those curious why two columns of payments. I never bothered to change the format from the template. It worked for us to track expense.

After texture was complete, we had to prime all the walls again. We decided to use a paint sprayer since the house was already taped off for the texture guy. To rent one would have been $85 dollars a day. It would be much better to buy a paint sprayer. As we were about to purchase one, a friend called and lent us theirs. This was a huge time and cost saving that we really appreciate.

Once the walls were primed with a water based primer, we began to paint. Again we sprayed. Once the walls were done, we taped them off and sprayed the ceiling. Unfortunately the sprayer broke one night and we did not know how to fix it at the time. We were up till 3am rolling the ceilings so we would be ready for the flooring guy the next day. We pulled several evenings after work that lasted well past midnight. Poor decision to not hire it out, but due to our budget, our only choose. We have painted the house 3 times now and still have to do the trim, kitchen and bathroom ceilings.

The counters, appliances, water heater and windows are all in now as well. We are heading into the home stretch. The plumbing guy is coming to install sinks, water lines and tubs on Tuesday. The floors will be done by next Friday. The contractors will be in next week for final touch ups and our punch out list.

I leave you with this quote. When planning for 2011 my wife simply stated “Put energy where it belongs.” This will be a nice guiding light when planning next year.

Here are photos for the last two weeks.

On to the progress. We spent the better part of the week prepping for the kitchen cabinets. Unfortunately, the kitchen wall paper did not want to come off. Many hours with very little results. We had the contractors replace the associated drywall. Much cheaper time wise. 10 sheets of drywall.

We also removed wallpaper from the rest of the house. Because of the wallpaper, we used an oil based primer on all the walls. This was to allow for the texture to hold better on the walls. The house transformed from oranges and pinks to a nice white. Of course we will have different colors after the texture.

The cabinets arrived as well. Other than a slight snafu putting in two cabinets backwards, all is well. They look great and are a great selling feature. We went with Mastercraft cabinets, dovetail drawer construction, and roll outs.

That all for now. Hope everyone had a great thanksgiving. “This world is but canvas to our imaginations.”
Henry David Thoreau

The mudroom was drywalled this week and the entry door from the garage installed.

The master bath was framed and backer board installed. For the limited master bath usability and objects in the way, we have made excellent use of the space. We had to allow for two boiler lines, two windows and two doors. We will still have a 36 inch wide master tub that is 18 inches deep and has one shower head on each wall. Hardly any added expense for the duel shower heads. It will be a nice feature.

The boiler guy removed one line where the mudroom door was placed and he also got the boiler running again. The house heats great. Not bad for a 40 year old boiler. Those things will last for 100 years if you treat them right. Very few moving parts.

The tile has been removed from the front landing and fireplace. No easy task since it was mortared to concrete. The stairs restoration is in progress. Taking that paint off is no easy or quick task.

I think the most exciting change for the week is seeing how the mudroom has taken shape. It will make a fantastic entry from the garage where one did not exist before. This mudroom will rival those found in 500k dollar homes. Even the contractors have been excited with how well it worked out that half that bedroom overlapped the garage and allowed for an entry door.

That’s all for now. I leave you with this quote, “You must never confuse faith that you will prevail in the end—which you can never afford to lose—with the discipline to confront the most brutal facts of your current reality, whatever they might be.” Vice Admiral James Stockdale (Highest ranking POW of the Vietnam War.)

Mudroom

Front Stairs

Front Landing

Master Bath

The contractors are go-getters. What the two of them have accomplished this week is pretty impressive. The kitchen and all 3 baths have been demolished. All the carpet in the house has been removed, including the tack strip. The mudroom paneling and drywall removed. The plumping in all three baths has been replaced, the new line to the mudroom has been installed. The new master bath has also been framed. Electrical has been moved and added to where needed.

We have watched our budget closely and will be about 5% over at this time. This is due to me entirely underestimating the kitchen cabinets. We aren’t using typical rehab cabinets here. So far we have been non stop busy, but it is part of our long term financial goals. It will be very much worth it.

I leave with this quote; “If you want to be really good at something, it’s going to involve relentlessly pushing past your comfort zone, along with frustration, struggle, setbacks and failures. That’s true as long as you want to continue to improve, or even maintain a high level of excellence.” Tony Schwartz

Here are some photos.
Front Entry

Living Room

Kitchen

Mudroom

Master Bath

Master Bath

Main floor half bath

upstairs bath

main drain line

Here is the scope of work. Post Scope of Work
Big picture items
-replace kitchen
-gut and replace master bath, half bath and full bath
-replace windows
-create mudroom from main floor bedroom and move washer and dryer there.
-remove carpet and redo hardwood as necessary.
-replace water heater and repair boiler.

I’ll show week 1 progress in the next post. For now, I leave you with this quote;

“The range of what we think and do is limited by what we fail to notice

and because we fail to notice that we fail to notice

there is little we can do to change

until we notice how failing to notice

shapes our thoughts and deeds.”  R.D. Laing

The property already looks better. It’s amazing what a bit of elbow grease can do. My very wise Realtor also put an addendum in the contract stating that the sellers would have to cover any cost of items left behind. Because I cannot lift the couches alone, we will be hiring a junk hauling crew. We will be going after the seller for the cost. As a tip, I recommend folks add that addendum to all their contracts. Especially if your buying from hoarders.

I currently have 3 contractors preparing bids at the moment. I have also contacted a separate window contractor and boiler repair firm. It’s starting to get cold here in Colorado and I want to get the boiler working asap. No freezing pipes and no freezing us as we work on this house.

I’ll share the scope of work on the next post.  Till then, I leave you with this quote “Let our advance worrying become advance thinking and planning.” Winston Churchill

Purchase of 176k. First lien payoff was 170k and 2nd lien was 6k. The sellers agent got them down from above $8500. The sellers paid half and we paid half. The house is 3900 sq ft 5/2.5. Its a monster. Its far more home than we need or will use, but the deal is pretty good. The house needs 40-50k worth of work and will have a conservative ARV of 300k. The lender had to get a 2nd appraisal on the property because in its current condition it came in 30k higher then our purchase price. The closest comp is a house that sold from a rehabber I know. 3200 sq ft 5/2.5 for 299k. I’m pretty confident on the ARV.

The neighborhood was once a parade of homes neighborhood. For those outside of Denver, its a custom home tour of the best new homes in the Denver Metro area. Course that was in the 1960′s. Still for as old as the house is, there are a ton of very modern type features. It must have been incredible back then. Main floor master, country kitchen, oversized bedrooms (all of them), 2.5 car garage on a 11000 sq ft lot, 2 pump boiler, solar water heat with tank backup. Many things in the house were top of the line when they were installed. Unfortunately they have had many years of neglect. More on that in the next post. I’ll also go into repairs and our plan. Were both very excited about this house. For now, here are some photos. I leave you with this quote. “One secret of success in life is for a man to be ready for his opportunity when it comes.” Benjamin Disraeli

check back for pictures when I’m not tired and can figure out wordpress

I had a great mastermind call with my coach last week. He could tell I had the wind knocked out of my sails a bit. I was so ready to do my first solo flip, that I almost took down a bad deal. Still, my nature absolutely hates losing. The good news is I would have lost far more had I done the deal. For you baseball fans out there, think of it as a pop fly to advance the runner. Yes I took an out, but it wasn’t a double play. I am still at bat and this inning aint over.

Moving forward I have several marketing items on my agenda. My coach has me focusing solidly on only a few items rather than casting a wide net. Works for me. My time only allows so much.

First I will stay on the MLS and check it daily. This has proven useful so far. Not only do I get to find houses, but I see market trends, see photos of other rehabs, and all the other fun stuff the MLS affords me.

2nd, I am sending out to absentee owners in my target area. I bought my list from Melissa data, bought my stamps, put my letter together. Now I just stuff envelopes and mail them out. Due to the cost of 600 letters, I will mail out 300 per month alternating months. This has the cost savings and time savings. With my 7-4 job I can’t be around to field all the calls. Plus I need time to look at hot leads. This should space things nicely.

3rd, but likely not last, I will continue driving for dollars. While my first batch of letters got no calls, I have refined my letter and will be sending out round 2. I have also gotten better at finding rundown houses. This should help me going forward to not waste time on unmotivated sellers.

I say not last, because as all good marketers recommend you need to cast several lines to catch a fish in this lake. I will implement other items, that I can afford, down the road. I have set times and goals moving forward with this marketing. As I refine my goals and planning, the process is getting stronger and more subconscious. Exactly what I shooting for.

In other news. We are set to close on Wednesday on our new personal residence. My superstition has gotten the better of me and I will wait to post pictures and details till then. I would be lying if I didn’t say we are both getting very excited.

That’s it for now. I leave you with this quote. “If you have built castles in the air, your work need not be lost; that is where they should be. Now put the foundations under them.” ~Henry David Thoreau