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New House

published March 22, 2019

After owning our new house for over a year, we finally moved in. Like all good things, it did not come easy. There were issues from the very beginning.

Most of the best deals that I have come across in my 15+ years of investing were ones that took lots of time to get the deal closed and then to rehab the house. The biggest problems are usually the best deals.

Let me tell you, this one was not easy and if you are just getting started in investing I would NOT recommend a complete gut with full rehab. We even added just under 100 square feet of space for a laundry room.

While we are very proud of our house, it was about a 9 month rehab that wore us down emotionally and maybe a little financially also.

We so wanted to get things done quickly, but as with all rehabs you have rules to follow with the city and with contractors. There were no contractors that were bad per se, but most contractors are very busy and if they forget something or an inspection did not pass, they are not very motivated to come back that day or the next day.

This is really frustrating when you have something scheduled for a couple days later and now you have to call them to postpone them because your earlier contractor failed an inspection and cant come back until next week. Frustrations.

The money part was a little self inflicted. We knew that we were going to live in the house so we ended up adding some things that just took more money. It all started with the foundation.

The addition to our house was from the 60s or 70s. It was not done very well. We thought that we were going to have to add a few piers and some support beams. Well…we ended up putting all new piers, added piers for a wrap around deck in the back yard connected to the house. And there were NEW beams to go with it which all together ended up pushing the budget right from the start an extra 8k.

As we began taking things apart and peeling back the plaster (about 1″ thick on the walls), we knew we had to redo all the plumbing and electrical. This was a nightmare as far as time goes. Working with the city to get electricity from the pole to the house is a nightmare. It took a couple of months for them to come out.

I was told several times that things were approved, but for some reason it never got done. I know why it never got done. It was because SOMEONE FORGOT TO PUT IT ON THE SCHEDULE.

The inside of the house was another delay, but it was our fault.

The house is in a conservation district. It is kinda like a historic district, but they are not as strict in some aspects of your house. They want the feel of the neighborhood to stay the same, but will not get too far into the details of what you can and cant do with your home.

Historic district is a little stricter as far as the exterior of the home. They want you to keep it almost exactly as it was 85 or 100 years ago. When possible they want you to bring items back to original.

What we decided to do was apply for our home to become historic. It is almost 85 years old and was one of the earlier homes that was built in the area during the depression in 1935.

Taking that into consideration, we wanted to keep as many of the historic items in the house that we could. The exterior HAD to stay the same as far as the street view. Our deck in the back was not going to be an issue. Additionally the siding in the back of the house was ok to be sided with Hardi-siding.

What we decided was to keep all of the doors of the house. I took off all of the hardware on the doors. We kept most of the hinges and used them again. The crystal door knobs were cleaned by hand with a dremel. The door cassetes and locks were cleaned up and made to look new again.

All of the solid wood doors were stripped down to the wood, primed and painted. All of the trim in the house, if it was original, was stripped also and primed and painted.

This is really what took the most time and $$. Paying people to take 10+ doors down to the wood with several layers of paint was a huge task. Then they did the same with the baseboards. The beautiful hardwood floors were saved, sanded down and brought back to life.

Upstairs the floors were very gently used and were in excellent condition. The downstairs were of course used much more. People tend to spend time in the living room and dining room more than the bedrooms. This caused us to put a heavier and darker stain on the downstair floors to mask the new wood that was added because of damage to the floors.

The wood windows are functional. I personally love that. I like to open a few windows in the morning and let the cool in. It is especially good for keeping the home cool when we have those 50degree or 60 degree mornings and then 80 or 90 degree afternoons.

My Uncle is a pretty good carpenter so he helped me with most of the windows. Some of them were so bad that he took out the old windows and created new ones using all kinds of planers, joiners, routers and more than one table saw. He sanded, glued and nailed new windows for the bay windows in the living room. Several others were replaced with his creations also.

You will not be able to tell which windows were from the 30s and which ones were just made. Great craftsmanship.

Insulation was upgraded also. We used spray foam in the attic, all of the roofed area and walls that face south. While it was a little more expensive, I believe that it will keep the house a little cooler in the summer and warmer in the winter. This of course will keep the utilities down.

Central Air was replaced with 2 units. We new have a 3 ton and a 2 ton unit. The 2 ton is for upstairs because there is only about 6oo sf upstairs. It does have to be a little bigger because of the hot air that will rise in the summer otherwise we probably could have gotten away with a 1 or 1 1/2 ton unit.

I had hoped to have both of the units with gas for the heat, but the downstairs unit could not be configured that way so we went with gas up and electric down. We also have gas for cooking and we have both electric and gas for the dryer. My wife likes the electric for the dryer, but when this dryer goes out I am getting a gas dryer.

This is the first time that we went with a water softener. I absolutely love it. Your skin feels so smooth!!!

Since we were going to go with a water softener, we also decided to use a gas on-demand water heater. WOW. You never run out of water. The water heater is placed on the outside of the house so that no room in your house is heating up all the time in summer and making it hotter inside.

When you fill up a big tub with hot water and relax with those powerful jets that help you relax…AHHHH…you still dont run out of hot water. We could have the tub filled and two people taking long showers and not run out of hot water. When we sell the house, this will definitely be a huge selling point.

So overall, we made some huge improvements to the house. We bought it right at about 105k, put in about 125k so that we are all in about 230k for a brand new historic home. The retail value of the home should be somewhere around 300k. So we built in a little equity even though we spent more than we wanted to with our house.

I forgot to mention that when you get your home designated historic and you put in more than 30% of the taxed value that you get some tax credits also. We decided to take the 5/5. That means we pay NO CITY PROPERTY TAX for 5 years. For the next 5 years we pay 50% of what the city tax should be.

We could have gone with the FREEZE, which is that your city property tax would stay the same for 10 years in the year following the improvements. I figured the value would increase right after we did the improvements so it did not seem like much of a benefit.

The final touches on the house are what I think really make the house. Colors. We used several colors throughout the house. The house feels alive and excited, not plain and all one color.

Fixtures. We spent a little more on our plumbing faucets. The house had to have a modern look without costing a fortune. We saw shower faucets that were several $1000. I could not bring myself to spend quite that much, but we did upgrade from the basics.

The ceiling fans that we have in the living room and the master bedroom are a little over the top. They are 9 bladed, 72in ceiling fans. Our kitchen and dining room light fixtures are very special also. All of the house has LED lighting that will keep the heat down as well as the electric bill. Most of the light fixtures, with several light bulbs, will only have less 50 watts for the whole fixture.

You can see some of the pics in the ABOUT RICK tab on the website as well as on our house, mid-rehab and progress on our house. I have some more on Instagram at sarealestate_rick.

All in all it was a test of my rehabbing ability. It was a test of marriage by living in a 350sf efficiency for about a year while we did the rehab. The good thing is that we came out good at the end. We are still married and the house looks great.

I hope that you can come out and see the house some time. We are going to start having our Wine Therapy pretty soon. Look for it on Facebook under the group name Wine Therapists. We have it as a closed group, but just ask to join if you would like to have a glass of wine or beer with some friends on our event nights. We dont sell anything, just gather to spend time with friends old and new.