Zillow is wrong. My Zestimate is $50,000 too high. We will see what it sells for and as i always say, the market dictates the price. Walk through with me and check out the progress happening at the Santee project. You can see the cool reclaimed wood look kitchen floor tile we picked out and some minor floorplan changes to make this house way more functional. We threw a little more money at this house than the average house flipper would here in San Diego, but the buyers are going to have a great house that they can enjoy for years to come! Zillow’s Zestimate has the price so wrong. I read recently that even the Zillow CEO sold his personal house for Millions under the false Zestimate online.
In any other state I could have been all the way up to the second floor framing this week but here in San Diego the City inspector wants to see your floor system framed up first, verify the hold downs and framing, then come back and inspect the underfloor plumbing lines, then come back again and inspect the insulation. You lose a day in between each inspection so this would have dragged out for a week. It really makes sense to do it this way because its easier to do the under house plumbing now, rather than crawling under the house later to do it but the reason the inspector wants it done in this order really just comes down to the fact that he’s not crawling under the house no matter what.
After framing up the floor system in a day I had my plumber come and set all the under floor ABS waste lines and fill them again with water to make sure there’s no leaks. Lastly the insulation got dropped in on nylon netting we strung between the floor joists. Its a real trick way to insulate the floor on a new construction raised foundation house. I’ve used wires in the past but the insulation always ends up falling down in some places. Once we pass then we just sheet over it. The threaded rod you see sticking up is for the Simpson HDU hold downs that secure 4X6 posts in the exterior walls all the way down into the concrete foundation footing. This is to securely hold the structure on the foundation in case of an earthquake and they are strategically placed in shear wall areas by the engineer on the plans.
Of course I had a better idea. I tried to speed things up by only calling once to have him come do all 3 inspections simultaneously. I had the insulation pulled back along the sides so he could see the framing, plumbing and hold downs thinking this would be fine, unfortunately he wasn’t really that excited about my idea. My regular inspector didn’t show up but rather a Senior Inspector who happens to be very thorough and whom I’ve dealt with before. He almost gave me the signature required in order for me to sheet the floor with CDX and start putting walls up, but he found one plumbing fitting that he said wasn’t correct so he’s coming back Monday after we change it and also wants me to pull more of the insulation back for a better look. Uggghhh. My plumber swears the fitting he used is allowed, its a Sanitee on its back for a 2″ vent pipe. The inspector wanted a sweep which is weird cause its only a vent, not a waste line. Who knows but I wasn’t going to argue with him, I told him he’s the boss but I kinda want to check the code book now though just out of curiosity.
The senior inspector asked who the general contractor was. Hesitantly, I told him I was an owner/builder. Seeming surprised he said it looked better than most jobs and kept congratulating me on doing such good work. Maybe he was just trying to make me feel better because he could see it on my face that I was bummed not being able to start putting up the walls. He knew I was totally ready to go, as he was doing his inspection I received the first delivery of truss material for the second story. I should pass on Monday and we’ll be back in action. I’m a Chevy guy but how cool is this early Ford extra cab delivery truck from La Mesa Lumber?
Just a little more concrete last week and now its time for framing. The first thing I did was have a third party inspector come and sign off on the construction of my block stem wall. He personally witnessed the mortar mixture and rebar placement inside. Then I called the City inspector also to sign off on it once it was completed. The reason for the extra stemwall is because the outside wall is the balloon wall and the inside wall supports the load from the upstairs floor joists. The stairs go up in between these two foundation walls and each has its own footing.
When the truck came to fill it up we also had to have the third party “special inspector” on site to take a sample of the mixture that came out of the truck. He packaged it into a small box that he’ll send to a lab for analysis. They test part of it at 7 days and the balance at 28 days for compression strength by putting it in a crushing machine. Inside the stem wall I used 2500 PSI grout mix. I only normally use big rock but this is the only place that its o.k. to use the pea gravel mix. I would never use it in a concrete footing , foundation or driveway. The cost for the 2 trips from the special inspector and the lab test was about 500 bucks. I don’t know what would happen if the lab discovered I got a bad batch from the concrete company, probably make me tear down the wall and start over. I’d rather know now though before I move in that’s for sure!
Next I poured the garage floor. First I rented a compaction machine for the dirt, then put down plastic moisture barrier, topped it with 3-4 inches of manufactured sand and then my #4 rebar 18″ on center tied into the perimeter footing as the plans called for. Once the City came and inspected it we just backed the truck right up to it and poured 7 more yards of 3000 PSI 3/4″ concrete. Once again you’ll see a lot of guys using pea gravel mix but its not nearly as good and tends to crack faster. The larger the rock size in concrete the better. I’m ready for framing now and getting material price quotes from Home Depot, Lowes and Dixieline. Hopefully we’ll be starting on the floor system by mid week if I can get a quick delivery, the framers are anxious and cant wait to get started. I’ll order my custom Milgard windows and exterior doors this week as week so they will arrive about the same time we are done with framing.
Happy Holidays to everyone! It has been nice to take a break and spend time with my family and new addition for the holidays. We are out there turning over stones and looking at tons of new fixer upper houses to buy in San Diego, thanks to everyone who is also sending me leads. We Buy Houses in San Diego so if you know of a house please contact me. The Painted Lady sale is closing next week after easily passing the physical inspection and VA appraisal. We even have a back-up buyer in place who is devastated she didn’t get the home.
The home inspection was pretty interesting to say the least, we sometimes miss something but generally have had no problems with our homes passing after all the work that we do. This inspector however took a different approach and basically made some stuff up to fill his report. The big front picture windows we had custom made are of course tempered glass for safety, the inspection report I saw however said they were not. Tempered glass has a little logo in the corner, easy to see. For some reason this inspectors eyes weren’t focusing that day I guess. Foundations on old houses are another item that inspectors just feel they need to address for some reason, even if they are fine. The inspector wrote in his report that the house was not anchored to the foundation. Really?? What are all those J bolts through the bottom plate in plain view and the UFP plates along one side? I can see how some inspectors might not want to do the army crawl and check the entire perimeter under a house that sits low to the ground but there’s enough room under our house to have a party, believe me I spent all summer under there! Also the guy calls out the plumbing for being old cast iron which we removed and replaced with ABS. Probably the funniest thing I read in his report was that a light didn’t work in my hallway. I say to myself, OK a bulb must have burned out but surprisingly enough I get there and see that the dimmer switch on the 3-way wasn’t even on! If you are going to say something is wrong on a report wouldn’t you take a really good look first? When you get an inspection report that has obvious errors it’s best to just address them and provide your buyer with something in writing that shows where you feel their inspector was wrong. In our case my buyer was happy I showed him where probably 5-6 points were clearly invalid on the report.
Remember, 3rd party home inspectors are not City inspectors nor general contractors, and most of the time have minimal building knowledge. A home inspector credential can be obtained with 60 hours of online courses. Getting a bad inspection report is pretty common and sometimes is enough to spook a buyer and cancel a sale. It’s emotional enough buying a home, especially for a first time buyer. One home inspector in San Antonio named Matthew Gessner from Amerispec was famous with all the local real estate agents for blowing deals, its a wonder anyone uses him. A bad home inspection report sticks with the property, right or wrong, and has to be disclosed to future buyers if your transaction falls apart.
As I mentioned The Painted Lady had no problem appraising for the sales price. Home appraisers like to compare apples to apples but in our case Grant Hill doesn’t have any other sales comps for turn-of-the-century Victorian Houses, however within the 1 mile and 1 year guideline, the average price for a home like ours is around $600,000 although its best to use comps within the last 6 months and a half mile if you are an investor. If you are doing a big spec project like ours I would take a look at whats comparable within the year and a 1 mile radius, if you cant justify your sales price with what you find, there is a good chance that an appraiser wont be able to either. I’ve known several real estate investors here in San Diego that after rehabbing houses and getting into escrow, they had to settle for a lower sales price after a low appraisal came in so be careful with determining your ARV.
No LaDainian tomorrow but we have another LT, Darren (Lil Tank) Sproles. “I’ve played against him and seen a lot of film, I’ve never seen anyone get a great hit on him” – Troy Polamalu.
With the incredible D of the Steelers we have our work cut out for us. The good news is the Steelers don’t run well and can’t score. With only 11 points scored against us at our last meeting, turnovers might decide the game. My prediction 28-17 Bolts. Go Chargers!
We are anxious to return to work soon on The Hat Trick House, stay tuned for regular updates once I get back over there. We want to give a special shout out to another blogger and investor named J. Scott at REIstartup.com.
He and his wife also quit their corporate jobs and moved from California to the Dirty South like we did. I love his site, he shares tons of info, tips, numbers and pics. I can’t get off it. It’s a must read! You can find J Scott in Bigger Pockets website commenting on real estate posts.