Thursday, April 22, 2010

Short and Sweet Post...

So I came across an awesome bathroom idea from a house that is for sale in the East Nasty.  How awesome is the sink?!

Other than the shag on the toilet seat this bathroom is clean and pretty awesomely modern.

Now for the coolest part of this bathroom....the sink....

So one of the best parts about this sink is that there is no drain plumbing....goes straight into the shower...not only completely awesome but also a little cheaper as well....SO COOL!!

I'm still on the hunt for the next flip.  And I love to come across other flips that have been done well like this one to get awesome ideas from.  Later.

Monday, April 5, 2010

Dreams don't always come true...A note on Real Estate Agents from a Real Estate Agent

Ok, so I had recently wrote about the house that I wanted to flip in East Nashville....well that dream was crushed a week ago, when I found out from the other Real Estate agent that a contract had been written on the property.  Here's what happened:

We were going back and forth negotiating on price.  We were off by a measly $2k.  On Friday I emailed the other agent the counter, and got a response that she would talk to her sellers and get back with me.  No word from the other agent on Saturday, so I emailed her Sunday to get an response.  So Monday I did my daily drive by of the property and saw not one truck...but TWO in the driveway, and paint swatches on the front porch.  I started freaking out.  I emailed the agent and she responded that her clients were not willing to budge from the price.  So I promptly called her back (no answer) and emailed her to let her know that we would write up an offer for the $60k price her clients had previously threw out there.  An hour or two later I got an email saying that they had received an offer on Sunday for $62,000, and that she thought we would not come up so they accepted the offer.  Now that is pretty much the same $60k we were going to agree to, b/c I asked for no commission while the other offer asked for 3%.  Needless to say I was crushed by the news.

This brings me to what I wanted to talk about.  This agent was taking almost no commission from the sale, the owners had hired her b/c she was their friend.  Now I am not saying real estate agents related by blood or friendship are bad, but they can be.  This also goes for real estate agents that take a reduced commission just to get the listing, the old adage you get what you pay for is extremely true.  Had the other agent called me and said, "Look we have another offer on the table and I just wanted to give you a heads up before we proceed with the negotiations in case you were interested in putting in a higher offer," guess what would have happened...she would have been in a multiple offer situation and probably gotten much more for her client in the long run.

So what to ask real estate agents when listing your property or using them as a buyers agent?  Well yes ask them what kind of marketing they are going to do, how will they promote your listing, and all the other questions you can find on the internet.  But....also ask something they won't see coming....what is one of the hardest or weirdest transactions you have completed and what did you do to make it go smoothly...or maybe when you get an offer on our house what are the steps you take when receiving it; i.e. what is the process you go through.  What you want the agent to say is...I will call you and let you know we are expecting an offer, and then I will communicate with any other agent that has showed the property and let them know we are expecting and offer.  Why you may ask?  Well more often than not, someone that has seen the property that said that they are not interested may have changed their mind, or it may push someone into writing an offer if they were on the fence; and most of could result in a full price, over asking price, or higher offer.  I have had this happen more times than not after calling the other agents.

One such occasion was a flip I was doing, we received an offer below asking; I called the other agents, one of which said her clients were not interested before the call, but after calling her they suddenly wanted to put in an offer.  After hearing this I called the original agent and let her know that we were expecting another offer and if her client wanted to amend her offer we would let her.  My clients were willing to take the higher offer from the second agent b/c they thought the first one (50k below asking) would never increase the price.  Well guess what kind of offer we got back, $25k over asking with a moved up closing date; all of this for an additional 10 minutes of work MAX.  So they could have gotten an agent willing to reduce their commission by 1% resulting in a savings of $4,500!!!  Or paid the extra 1% (which they did) and make an extra $70,000 more after the extra commission......hmmm which one?!

Don't think that the multiple offer situation will not happen in this "economic downturn" or "soft real estate market" it happens everyday.  And having an agent that is prepared, and knows what to do, can result in a sale for more than expected.  Now having an agent who knows how to handle multiple offer situations is not limited to listing agents.  Buyers' agents should know what to do as well.  Ask a buyers' agent what they would do if they knew there were multiple offers coming in on a property.  Would you just go in with the most you would be willing to pay?  Do you have another option?  You do, and probably 1 out of 25 agents know of the other option (if not less).  I call it an escalator clause, but that may not be the correct term.  What it means is that you put an offer in lower than asking price, but with a clause that will escalate the price above any other offer price they may get, up to a certain price...I just lost you didn't I?  In other words say there is a house for $200,000 and you were going to put an offer in for say....$180,000 (your "low balling" them)....but your agent gets a call from the listing agent that they are expecting other offers (yeah sure they are).  Don't scramble and put in your highest and best offer...add this clause that says....We are offering $180,000 but should you get another offer for more we will "escalate" our price $2,000 more than the highest offer up to a purchase price of $205,000.  What you have done is if the other offer was for $190,000 you have just got the house for $192,000 instead of putting in an offer of $205,000 saving you $13,000.  Now the other agent has to show you the higher offer for the escalator clause to work (extra verbiage needs to be added but you get the point).

So this brings me to an end.  I don't know how some agents are still in business when they cannot negotiate or know how to protect their clients' best interest.  I just got burned, and I feel as if I was in some horrible break up.  I find myself still thinking of the house and comparing it to every house I walk through, I still drive by it sometimes.  So kids....when looking for an agent to buy or sell a house, ask them the tough questions, and if you don't get the answer your looking for move on.  Just b/c some agents reduce their commission does not mean that they are better or that you are getting a better deal, more than likely you will lose money in the end.  That is all....I'm off to find my next dream flip...hopefully they have an agent that knows what they're doing.

Tuesday, March 16, 2010

Termites...Water...Mold....ohh my.....a word on Inspections.. there will not be any (cool or uncool) photos to go along with this post, well maybe...  Inspections in general send a chill down my spine.  Whether it is with the city/county for building inspections or home inspections when you are selling a house.  They are make or break the sale or budget no matter what kind it is.

A couple of days ago we got the inspection report back on the Springview house; the house we dropped $150k and then accepted an offer $90k lower than that!  Lets just say I may have wanted to vomit after seeing the report, and what the sellers wanted done.  They either wanted everything they asked for fixed....or $20k off the already reduced did I feel slightly responsible for everything on the being the contractor and all.  All I kept thinking was....the offer is going to fall through and we are going to have to try and sell this stupid house again, and I am going to have to fix all the work (mainly being in the crawl space...the horrible bowels of the home).

This brings me to why I was writing this....what was the reason?  Ohhh perfect as you may think a house isn't.  Sometimes it pays to get a PRE-home inspection so you can figure out and fix any glaring defects with the property.  While this may not have saved us any money in the long run...having an inspection report for potential buyers, makes them feel more at ease with the house; and will more than certainly make for an easier and faster closing.

So this brings me to the beginning of the end (without pictures).  Our inspection report came as a surprise to us, it found "moisture" in the crawlspace, termite damage to some of the floor joists, and MOLD!!!  Granted, all of this was unknown to us (and completely fixable), someone should of told us right?!  Well now it doesn't matter.  We countered our counter with $15k off of our contract price and it has been accepted....hallelujah... Springview is closing on April 7th; and this means that we can MAYBE get Porter...will keep y'all updated...all one of you...yes Tyler since you are the only one following it comes down to you.

Moral of the story, while simple and short, get a home inspection as a buyer; and it pays to have one as a seller (as I am finding out).  My experience has never been bad after an inspection...but it is one of those unknowns that always makes me hold my breathe until the final report comes in.....

 Only our fair godmother can keep us safe from inspections!!

Sunday, March 7, 2010

Traditional vs Modern...or is it Traditional and Modern? Carrara Marble Edition and I went to a tile shop recently to find tiles for the rehab house we have not yet acquired...and I kinda fell in love with carrara marble, as tiles, counters, and especially the basket weave.  After showing houses to my friends Cip and Jackie in search of their first home...we saw a bath with similar cheaper porcelain basket weave.  After seeing the carrara and chinchilla marble I have found my new favorite natural stone.  I am sorry to admit that the only reason I knew what chinchilla marble was, is because I watch Nip/Tuck...but I digress.  So back to the debate. While at the tile shop I saw a display similar to this: 

The sales lady and I got into a slight debate as to whether this was considered modern or being the one saying that it was both...her saying that it was only classic....little did she know.  So I decided that this will be the tile for the half bath...unless she can get me a great price; where as this will be the tile for the master bath as well.  After searching the amazing internet and google I found a picture that is pretty much exactly what I want do do with the half bath.

So is the mix between classic and modern really attainable?  I believe it is...and I think that carrara is where its AT!!  I will soon put up a post of a lot of my tile ideas and what I would like to do in the extra bath and master if I cannot afford to put the carrara in the master.  I think that if you want a timeless look with a modern twist...mix in that has been around since the ancient Romans....they seemed to be pretty classy.

So in honor of this beautiful natural stone I have found quite a few pictures that show how timeless and modern it can be.  It is the perfect way to mix a little old world class with some modern clean lines. Also imagine that beautiful marble paired with a vanity like this (vanities are the furniture of the bathroom and will soon have its own post):

And now for more pictures...b/c its more fun to look at pictures than it is to read:


Soo...when remodeling your kitchen or bath...if budget allows...carrara is the timeless classic that should be considered, if not used.  Remember what sets you apart makes you sell...

Setting off your flip or home.... a Real Estate agent...I get the pleasure of showing many homes, and hearing what wows buyers and what turns them off.  I want my new target market for my flips to be first time home buyers in their 20's (how will I know what they like?) thing that I know I like is tech stuff, modern design, and traditional homes....ok so some may think the other two don't really go together, but we will cover that another day.

So the tech part, being a PC user turned, into everything Mac person (although I still use a 5 year old Dell Inspiron laptop with broken speakers) I own an iPhone.  So every time the new app commercial comes out I have to stop speeding through the DVR, back it up, and watch.  The other day when I saw the app commercial with the Schlage Security Link app, controlling interior lights, I immediately researched and found out you had to pay a monthly subscription for it.....I was saddened....but then I saw another commercial not Mac related that had the same feature....I did more research and found a system that had no monthly fees and you can control the whole home (security system, HVAC, and ALL LIGHTS!!).
So this brings me to the reason for this post.  If you were deciding between two homes...around the same price, and one had the ability to control the home from your iPhone (or  iPod Touch which is included in the sale of the home) which would you choose....hopefully the tech home.  Now down to the price....almost all switches are dimmers, so not only can the light be turned on and off through your smartphone but you can control the brightness...ok price for an entire 1500 sqft home all dimmers, hvac control, and base station come to UNDER $1000!!  Other features are creating lighting scenes and controlling the temperature of your home, even has security camera capabilities (security camera add-on).

So, if you could sell your home a month or two sooner than expected you have actually paid for the system and a little bit extra based on a home worth $200, B/c that is two months less of interest you have to pay...and if you are stuck with the home even after installing, at least you have a cool new gadget to play with while you wait for it to sell!!

So moral for different in a GOOD way to home pays off in the end!

Saturday, March 6, 2010

My little jem of a house....

Well like I said I have found the next house to flip...I am taking a much more conservative approach to this one, and have actually gotten to walk through the property since it is not a foreclosure.  Its on Porter, in East Nashville right down from Family Wash.

So here is the little gem...the front at least.  While yes this will need a lot of work, it is partially demoed...and the flipping bug has bitten me again after two years.

Now what is stopping of right now the price is a sticking point.  We are off by a measly $10k....but that equates to new Ikea cabinets, countertops, and professional stainless steel appliances.

A finance professor from college used to always say..."Cash is King."  Granted he was talking about a companies strength is their cash on hand and a positive cash flow, but I feel it applies directly to our current flipping situation.  While we may have the ability to borrow money....we cannot borrow against this house, and the reason this house is being sold, is because the owner doesn't have the cash to fix it up and cannot obtain financing.  Ok bla bla bla right.

In my head I can already see which walls will be taken down, which new ones will be built, where the load bearing LVL's will have to be installed, and which walls will contain the plumbing and hvac stacks....the house has sold in my mind already.  It is a horrible horrible thing, b/c we have come to an impasse with the sellers, and the flipping home of my that as of now....a dream.  To get more of you as excited about this possible flip as I am, I am going to post some pictures of the house, and then later on post what I plan on doing in different rooms and what I feel is "trending" as far as styles and where to add money that you will either see an instant return on investment, or a decreased Days on Market when going to sell your house.  I will also add some awesome ideas and products that are out right now to help your "flip" sell (everyone's home is a flip when they go to sell it, just a really long one depending on how many years or months you have been there).

Here are some exterior pictures:

And now some interior pictures:


And this is the my fine little future flip....stay tuned to what I think it should look like and what I think should be in the house...

Flipping...Past, Present, & Future

So as I hinted to before, flipping homes has been my source of income since the end of 2005.  I got into the rehabbing world at the time of the upturn in real estate prices.  It was when anyone and everyone had the Midas touch for flipping in real estate....add some paint increase the price $15k and call it a day.  Time was even on your side, we would purchase a property; and four months later, after we had gone over budget in both money and time, we were able to increase the listing price by $20k-$40k...just because we had held it longer than we had wanted! 

Ohh the good ole days...they lasted for a while....until IT happened, the mortgage crisis, well while we in Tennessee remained relatively unaffected as far as home prices went, it was taking longer to sell a a whole 60 or 90 days!! We had gotten so used to putting the sign in the yard and getting three offers by the end of the weekend, we had forgotten what the market should really be like.  However, the homes we were flipping seemed to be immune to this new crisis, our two current properties on the market, Gordon Petty and Tinnan, sold without a hitch, with multiple offers and above asking!

So we thought, what could go wrong with real estate? I mean it was a sure thing right?  Well enter the house from hell...Springview.  I did my research as I always did, estimating costs, looking at comparables, searching the title to make sure it would be a smooth purchase on the court house steps...ohh yes that is right at the time we were buying foreclosures sight unseen for straight up cold hard cash. I mean this house was right under 4,000 sqft in Franklin on 10.5 ACRES....something that is extremely hard to come by.  Yes it was a ranch and yes they had previously tried to sell it with no luck...but I mean I could tell from the outside the home needed some work, it could be easily estimated without going inside...or so I thought.  So I show up to the courthouse steps research folder in hand, ready to put my max bid of $500k on the property, (yes cash) all the familiar flipping faces were there, my enemies...we had bid against each other for years now.  The enormous butterflies in my stomach never seemed to go away on bidding days.  So I stood, and I waited as the auctioneer sold the first property of the day.  Next up, 435 Springview Dr. ohh the butterflies were bursting to get out.  The auctioneer says, "the bank has an opening bid of $349,000," ohh wow this is going to be a long auction I thought, since we are going to be in a bidding war.  I threw out my first bid of $350,000.  I looked around expecting a competing bid from my fellow rehabbers....nothing...$350,000 going once...twice....sold to Mr. Neel.  At this point I was FREAKING out....had I missed something that everyone else had seen?  Or, did they just not know the value of the property was in the $750k dollar range?

Well fast forward two years and more than $200k later, and the house has just gone under contract for.....$510,000, yes a loss, the first one of my flipping career.  Yes the $200,000 is an inflated amount set my my parents (IRS if you are reading this I am actually lying that is the exact amount if not less that we put into the house) but still what happened to the estimated $750,000?  What could possibly have happened? Well to all of you thinking of flipping, when flipping in the upper-end of the home market, GARAGES ARE KEY!! Everyone said what a great price the property was at $749k when I had listed the property just no garage, I was down to $599,000 when we got the lowest ball offer of all low ball offers.  Yet...we took it...ready to get out of this sinkhole of a property, and do what....find the next flip!

Well...I have found it....and that is what has prompted me to document its transformation from dilapidated the awesome classic/modern bungalow it always wanted to be....