Chris also capitalized on some innovative debris removal today...unloading the washer, dryer, fish tank, weights, dishwasher and a variety of other scrap metal items. These folks drive through city alleys in trucks searching for stuff they can take to the metal yards for cash. We both hit the motherload today - they got the haul of the week and we had free labor remove everything from the basement. And the pictures to prove it.
Saturday, August 23, 2008
Chris also capitalized on some innovative debris removal today...unloading the washer, dryer, fish tank, weights, dishwasher and a variety of other scrap metal items. These folks drive through city alleys in trucks searching for stuff they can take to the metal yards for cash. We both hit the motherload today - they got the haul of the week and we had free labor remove everything from the basement. And the pictures to prove it.
Awesome day at TLS today - big progress now, so exciting.
This weeks highlights include: first floor bathroom tub has been reglazed; upstairs painting has begun; countertop in the kitchen has been installed; front and backyard are being landscaped.
We're in the home stretch!
I submitted the listing tonight on Craig's List and finalized the forms for Apartment People.
Check out the pictures, more details to follow!
Sunday, July 27, 2008
Floors!
(Today we have a special treat, a posting from the other Managing Director of Turtle Lake South, LLC, also considered by many to be the company faceman.)
I never thought I'd be excited about floors, but this morning as I laid in bed, visions of the mighty Oak trees that gave their hardened existence to be hidden underneath glue, padding, and crappy carpet for decades at Turtle Lake South, danced in my head like a truck stop stripper flashing for pennies from overweight, unwashed road-warriors. (NOTE: this is not a degradation upon truck drivers, they drive the systems I sell to my customers, while they don't always handle the equipment with the care they should, the American trucker is the backbone of our economy and a fine example of capitalism and Reaganomics still in existence.) But, I digress, one of our main background concerns at TL-South was that of the condition of the old Oak floors underneath the carpeting. All week our savior and handyman extraordinaire, Carlos, has been removing layers of glue and tacked down carpet, and sanding his little heart out. And as you'll see from the pictures below, the old Oak floors are once again standing (or laying) proud. I love the floors, it has really made me happy.
Here's the overall update with everything. Much of the major work has been completed successfully, but not without speedbumps. Both bathrooms are 98% complete, new tile, new floors, new vanities, cabinetry, and new commodes, which I proudly have peed in both. The upstairs bedroom/office looks terrific, completely drywalled and taped, waiting for priming & painting and carpeting, which we ordered last week. Managing Director Erica, in charge of color and texture, wanted Chestnut, the carpet pro volunteering without us asking that Chestnut was the way to go, so she has successfully transfered over her leadership and business acumen from the world of PR to the world of TL. Still need to put in a new gas heater up there and pick up a window A/C unit, but we're close, much closer than we've been to date.
The kitchen is coming together nicely. Carlos and Paulo did a dynamite job of retiling the floor. Missing are all major appliances and our new countertop. Carlos actually went to pick up the countertop we ordered (wooden with a terrific granite covering, looks like a $5000 countertop when in reality it was about $350) and there was a very small hairline crack in the wood underneath. So he returned it and we have another coming. This is a testament to the quality of person that we have in Carlos. He made it much more a pain in the rear for himself by insisting the company replace the countertop, he said it may have shown signs of bowing 5 years down the road, 5 years! That is why we trust the man. That is why we have gone 2 weeks at a time with no contact, just the occasional pop in, and 9 times out of 10, we find Carlos and Paulo working feverishly, and always above and beyond. Note the post on the plumbing, they replumbed the entire house with new pipes, because they felt the water pressure upstairs was a little light, at no additional charge to us on top of the $600 or so he said it would cost to fix a massive water leak.
The last major task is a massive amount of concrete work to be done outside. Partially for liability reasons, more so for curb appeal.
There's a beautiful thing I've been studying known as cash out refinancing. Here's the gist: we re-appraise the place once we're done with the cash infusion, keep no more than 20% in, to avoid PMI which has no return on investment, and take the additional equity out for Turtle Lake South II. The place should appraise for $325,000 or more, we refinance with 80% of the $325K for a loan of $260K, our current mortgage is for $218K, that gets paid off and we pocket $42K for the next property. This could be the single most important thing I've learned about the long term investment property strategy, the key is buying the first house, all subsequent houses are purchased with equity on previous properties. It's AWESOME! We are in the game and on our way to early retirement. We will go more into the numbers and investment goals in another post, but it gets exciting to think about the prospect of owning 30 properties, paid off and earning $40,000-50,000 per month in rental income, all by age 50. We'll probably sail around the world for 5 years or so at that point.
The short-term goal is to get the place painted, get some appliances, do some landscaping, and rent at $2,200 per month, which pays our PITI (principal, interest, tax, insurance) and puts roughly $200 profit into the operating expense budget. The tenants than pay down our mortgage......HA HA HA HA HA HA HA.
Best case scenario is getting a renter in on September 1. A few months later than our initial projections, but we feel good about it. We have learned so much about rehabbing this Summer since we have pretty much rehabbed everything that could possibly be rehabbed. The only rehabbing left to do will be when I check myself into rehab from my Turtle Lake South money pit fueled bottle of wine per night habit I've picked up. At least the first 2 glasses are healthy.
Mark Twain once said, "you should always buy land, cause they ain't making anymore of it." He also said, "if a cat steps on a hot stove, it's the last hot or cold stove it'll ever step on." This doesn't really apply to TL-South, but it's one of my favorites. Here's to you Mr. Twain. I am signing off to shop for some sort of blogging/cowboy hat.
I never thought I'd be excited about floors, but this morning as I laid in bed, visions of the mighty Oak trees that gave their hardened existence to be hidden underneath glue, padding, and crappy carpet for decades at Turtle Lake South, danced in my head like a truck stop stripper flashing for pennies from overweight, unwashed road-warriors. (NOTE: this is not a degradation upon truck drivers, they drive the systems I sell to my customers, while they don't always handle the equipment with the care they should, the American trucker is the backbone of our economy and a fine example of capitalism and Reaganomics still in existence.) But, I digress, one of our main background concerns at TL-South was that of the condition of the old Oak floors underneath the carpeting. All week our savior and handyman extraordinaire, Carlos, has been removing layers of glue and tacked down carpet, and sanding his little heart out. And as you'll see from the pictures below, the old Oak floors are once again standing (or laying) proud. I love the floors, it has really made me happy.
Here's the overall update with everything. Much of the major work has been completed successfully, but not without speedbumps. Both bathrooms are 98% complete, new tile, new floors, new vanities, cabinetry, and new commodes, which I proudly have peed in both. The upstairs bedroom/office looks terrific, completely drywalled and taped, waiting for priming & painting and carpeting, which we ordered last week. Managing Director Erica, in charge of color and texture, wanted Chestnut, the carpet pro volunteering without us asking that Chestnut was the way to go, so she has successfully transfered over her leadership and business acumen from the world of PR to the world of TL. Still need to put in a new gas heater up there and pick up a window A/C unit, but we're close, much closer than we've been to date.
The kitchen is coming together nicely. Carlos and Paulo did a dynamite job of retiling the floor. Missing are all major appliances and our new countertop. Carlos actually went to pick up the countertop we ordered (wooden with a terrific granite covering, looks like a $5000 countertop when in reality it was about $350) and there was a very small hairline crack in the wood underneath. So he returned it and we have another coming. This is a testament to the quality of person that we have in Carlos. He made it much more a pain in the rear for himself by insisting the company replace the countertop, he said it may have shown signs of bowing 5 years down the road, 5 years! That is why we trust the man. That is why we have gone 2 weeks at a time with no contact, just the occasional pop in, and 9 times out of 10, we find Carlos and Paulo working feverishly, and always above and beyond. Note the post on the plumbing, they replumbed the entire house with new pipes, because they felt the water pressure upstairs was a little light, at no additional charge to us on top of the $600 or so he said it would cost to fix a massive water leak.
The last major task is a massive amount of concrete work to be done outside. Partially for liability reasons, more so for curb appeal.
There's a beautiful thing I've been studying known as cash out refinancing. Here's the gist: we re-appraise the place once we're done with the cash infusion, keep no more than 20% in, to avoid PMI which has no return on investment, and take the additional equity out for Turtle Lake South II. The place should appraise for $325,000 or more, we refinance with 80% of the $325K for a loan of $260K, our current mortgage is for $218K, that gets paid off and we pocket $42K for the next property. This could be the single most important thing I've learned about the long term investment property strategy, the key is buying the first house, all subsequent houses are purchased with equity on previous properties. It's AWESOME! We are in the game and on our way to early retirement. We will go more into the numbers and investment goals in another post, but it gets exciting to think about the prospect of owning 30 properties, paid off and earning $40,000-50,000 per month in rental income, all by age 50. We'll probably sail around the world for 5 years or so at that point.
The short-term goal is to get the place painted, get some appliances, do some landscaping, and rent at $2,200 per month, which pays our PITI (principal, interest, tax, insurance) and puts roughly $200 profit into the operating expense budget. The tenants than pay down our mortgage......HA HA HA HA HA HA HA.
Best case scenario is getting a renter in on September 1. A few months later than our initial projections, but we feel good about it. We have learned so much about rehabbing this Summer since we have pretty much rehabbed everything that could possibly be rehabbed. The only rehabbing left to do will be when I check myself into rehab from my Turtle Lake South money pit fueled bottle of wine per night habit I've picked up. At least the first 2 glasses are healthy.
Mark Twain once said, "you should always buy land, cause they ain't making anymore of it." He also said, "if a cat steps on a hot stove, it's the last hot or cold stove it'll ever step on." This doesn't really apply to TL-South, but it's one of my favorites. Here's to you Mr. Twain. I am signing off to shop for some sort of blogging/cowboy hat.
Saturday, July 5, 2008
We recently met several of our 'neighbors' on Winona.
In an ironic twist of fate, one woman's name was Debbie and has an uncanny resemblance to sister Debbie. She has a few kids and lives a couple doors down.
She gave us the scoop on the neighborhood -- including lots of dirty details about the previous owners of our house. She echoed much of what the police man told us who visited one day while we were working.
Gangs. Drugs. Big dogs. Graffeti.
Needless to say, she and our other neighbors are thrilled to see someone coming in and cleaning up the place. Seems like everyone is really nice, protective of the neighborhood. It will make a nice spot for a family of renters.
In an ironic twist of fate, one woman's name was Debbie and has an uncanny resemblance to sister Debbie. She has a few kids and lives a couple doors down.
She gave us the scoop on the neighborhood -- including lots of dirty details about the previous owners of our house. She echoed much of what the police man told us who visited one day while we were working.
Gangs. Drugs. Big dogs. Graffeti.
Needless to say, she and our other neighbors are thrilled to see someone coming in and cleaning up the place. Seems like everyone is really nice, protective of the neighborhood. It will make a nice spot for a family of renters.
Plumbing
The plumbing throughout the house needed to be reworked.
It was old, damaged and the line from the street came into the house via the basement.
The day of our inspection the city turned the water on, it wasn't capped, and we flooded the basement. Good news is the floor is concrete and there are drains throughout so this little glitch dried up quickly with no harm done.
We began with the first floor bathroom.
The wall between the bathroom and bdrm #1 was replaced. A leak in the upstairs bathroom had dissengrated the wall. The plumbing has been rerouted. The shower head, which previously hung above, though not like the appealing rain shower you may be envisioning, has been relocated to the traditional spot above the Hot/Cold nozzles. The floor retiled. The toilet replaced.
Take a look at the before and afters here.
We paid someone to come in and do debris removal -- three days worth.
We've had contractors in to provide estimates on anything and everything imaginable:
The upstairs and basement need to be drywalled.
Every window in the place was broken.
Every room needs to be primed and painted (oil-based paints throughout, and in many cases RED walls).
The carpet has to be removed, wood floors restored.
We need tuckpointing, sections of roof repaired, sidewalk patching, siding fixed.
A new garage door. A landscaper.
The kitchen looks like a warzone and there is a radiator under the sink.
Our goal is to rent July 15 - it is mid-May at this point.
We've had contractors in to provide estimates on anything and everything imaginable:
The upstairs and basement need to be drywalled.
Every window in the place was broken.
Every room needs to be primed and painted (oil-based paints throughout, and in many cases RED walls).
The carpet has to be removed, wood floors restored.
We need tuckpointing, sections of roof repaired, sidewalk patching, siding fixed.
A new garage door. A landscaper.
The kitchen looks like a warzone and there is a radiator under the sink.
Our goal is to rent July 15 - it is mid-May at this point.
In August '07, we made a lowball offer to the bank for $256K on a short sell. The place had been abandoned for eight months, inhabited by gang members who owned large, mean dogs (huge bones have been identified in backyard) and several of the front windows had been shot out.
Another buyer had made an offer several months before for $309K, but the deal fell through when the previous owner broke into the house, stole all the appliances and shot off fire extinguishers.
It took the bank five months to accept our offer, which they ultimately did in April of '08.
Nick, a real estate attorney and registered agent, assisted us in navigating the paperwork. If you're interested in doing something similar, check out his site.
We received a $6K credit at the closing for some bad plumbing and put 15% down. With closing costs, we're in for $45K.
The place needs to be rehabbed, essentially from the ground up. What follows is our story of the project...
Another buyer had made an offer several months before for $309K, but the deal fell through when the previous owner broke into the house, stole all the appliances and shot off fire extinguishers.
It took the bank five months to accept our offer, which they ultimately did in April of '08.
Nick, a real estate attorney and registered agent, assisted us in navigating the paperwork. If you're interested in doing something similar, check out his site.
We received a $6K credit at the closing for some bad plumbing and put 15% down. With closing costs, we're in for $45K.
The place needs to be rehabbed, essentially from the ground up. What follows is our story of the project...
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