by Tom | Apr 24, 2011 | Demolition, Floorplans, Painted Lady, Victorian House
Victorian House Remodel San Diego
Feels great to be back doing what I love, creating new spaces, and most of all home in San Diego. We spent all week doing demo on The Painted Lady, with 3 laborers I gutted just about the entire house, maybe only a half day left and we’ll be done. I filled nearly (3) 40-yard roll off dumpsters at $427.00 each. I was really worried that we weren’t going to be able to get the dumpsters into the back yard, having to put them on a public street is a pain in the butt as you have to have a permit. My only other choice was paying someone with a dump truck to drive the loads to the dump one by one. This would have been very time consuming and costly.
The house is huge inside, I am really excited and can see the final product already. Next up on deck after the demo is done is the foundation work, then I’ll be ready to re-frame the back of the house and put the new roof on. So far it seems sub contractor prices are not that much higher than I was paying in Texas, although I still haven’t nailed down a good electrical or plumbing contractor. Here’s a walk through video so you can see this great floor plan.
by Tom | Apr 15, 2011 | Painted Lady, San Diego Real Estate Market, Victorian House
74 days after arriving home in sunny San Diego we’ve finally bought our first rehab project, The Painted Lady. I’m real excited about it, she’s a 1909 Folk Victorian Gingerbread. The house is located in an Urban Redevelopment neighborhood just 1 mile from Petco Park and Downtown, with incredible views of the Coronado Bridge and all the way to Tijuana.
There are original hardwood floors under the carpet, 10 foot ceilings, and a lot of original details still intact. This is a huge project and needs just about everything a rehab could require. I’ll be leveling the foundation by adding a new perimeter stem wall and 40 new footings, new roof, re-framing a 360 square foot master suite on the back, replacing all the mechanicals, new kitchen, 2.5 new baths including adding a half bath under the staircase, some new windows and complete landscaping and fencing with an automatic gate on the alley. The house has aluminum siding that’s probably been on there since the 70’s. I peeked underneath it and there’s fiber shingles probably from the 50-60’s . Under the shingles I found the original wood board and bat siding which I’ll expose and also add some of the missing period details like the gingerbread ornamentation and porch decoration the Victorians are famous for.
The Victorian era began in the 1830’s and ran until roughly 1940. Our house is a Folk Victorian, more simple in design than the ornate Gothic or Italianate Victorians, and was usually built more modestly for the middle class. I’m excited to see the scalloped shingles under the gables which I’ll paint multi-color and the decorative gable bracket. This architecture can really hold color well so I’m planning on using a minimum of 6 bold colors to bring her back to life. I’ve done a lot of Craftsman style houses but this will be my first Victorian and only the second 2-story house we’ve rehabbed. With the huge scope of this project it will be a perfect welcome home project and enable me to become reacquainted with the City permitting, historical and inspection departments this summer as well as dial in my sub contractor team. If you can’t see the potential in what we have here, Google “Painted Ladies San Francisco” and you can get an idea of where I’m going with this project. Stay tuned for demo and a walk through design video!
by Tom | Mar 25, 2011 | San Antonio Real Estate Market
Yes folks, it’s definitely all about the short sales. With 1 in 6 San Diego houses underwater many homeowners are opting for strategic defaults and walking away from their properties.
The hungry agents out there are simply working the NOD (notice of default) list and finding plenty of anxious sellers who want out as their home is now only worth roughly half of their loan amount. This presents a huge opportunity for investors and home buyers willing to wait out what’s frequently a slow process.
After scouring MLS for weeks for REO’s and swimming with all the sharks out there I decided to switch gears and actually get on the phone and start networking with the short sale agents who are on the front line with all the distressed deals.
I’ve quickly come to realize that you have to make your own deals, not just look for one. Not every agent however who has a short sale listing is capable of influencing the deal, much less even closing it. There are third party professional negotiators who seem to have the process wired though. A good short sale negotiator can hammer the lender and dispute their BPO’s, even sometimes providing their own appraisals and documentation as to the value and condition of the property and build in the margin rehabbers need to make a profit.
The downside is it can take 2-6 months to close a short sale so we are filling our pipeline up with as many as possible. Knowing who these agents are and networking with them is key, once again its not what you know in this market but who you know. If you are a homeowner looking to do a short sale in San Diego, make sure both lien holders give you a “non-deficiency”, it holds you harmless for the portion of the loan amount thats been forgiven. Our short sale agent has 100% success ratio getting this and has done over 150 transactions. If you are interested in a short sale please contact me.
Calling All Contractors! Contact me if you want to be a part of our team!
Moving here I had the long term plan of stepping away from the labor part of the rehabs and just doing design work and overseeing the contractors. Afterall, these arent huge projects, mostly cosmetic stuff. I had given myself a 3 year window to get to that point but after arriving here its evident that this needs to be my new business model right out of the gate.
I’ll be hiring all the construction out so I can do multiple projects simultaneously so if you are a GC or know of a reliable one let me know please. Maybe once the market picks up for move up buyers I’ll do some larger structural projects again but the money to be made now is on the entry level stuff, that only needs light rehabs.
The profits wont be as large as we were used to but with increased volume we should be able to make it up and then some. I’m super excited, our California LLC is set up now, we have over 30 offers out there and some are very close to reaching acceptance so I’m looking forward to finding solid team members on the construction side.
Also, many people are reaching out to me, new blog followers and old alike. I’m stoked to meet all of you, after the machine gets running we’ll be open to joint venturing on some deals, offering some of our overflow deals to you or even using private investment funds so contact me if you are in San Diego and want to chat about all the opportunities we are seeing with the local real estate market.
I’m not totally over the bungalow craze so fast though, I’ve got an offer on this amazing California Craftsman REO, I hope it pans out. I’m competing with conventional retail buyer offers that are higher but hopefully the lender will opt for my all cash offer instead.
I utilized my “write the offer with the listing agent” strategy on this one: ). No matter what we start buying we’ll do some fun stuff and try to set our rehabs apart from the crowd by hopefully offering a little more attention to detail and some cool design sense. I’m really making headway, once we have more deals than we know what to do with I’ll share a little more about how I figured it out.
Stay tuned and thanks for following.
by Tom | Mar 13, 2011 | San Diego Real Estate Market
One things for sure, in every city across America you’ll find an abundance of 50’s ranch houses in great established neighborhoods and San Diego is no different. The post war Ranch style house is know for its sprawling lay out and horizontal orientation with the street, usually being single story and having an attached 2 car garage as this was the first decade where families actually had 2 cars. Low profile roof lines and fairly open floorplans are also indicative of this time period as are huge overhanging eaves and exposed beams. Sliding glass doors leading to outdoor patios were first introduced in this era as well. Looking at these homes makes you realize how perfect these traits align themselves with todays homebuyer, even 50 years later. 
Recently its become very popular to put the modern twist on these homes. Being in San Diego now I’m not sure if I’ll continue with the Craftsman Bungalow affair we had in Texas but with what I’m seeing done to these 1945-1968 Ranchers its looking pretty fun. You’ve got the large rooms, open beams and open floorplan. To get the modern element into the exterior all you need are aluminum windows, smooth stucco and some natural elements such as stained redwood or teak. These style homes already typically have minimal exterior ornamentation. Metal windows, dark wood and frosted glass, Bam. You got it. I really like this house a friend showed me this week during our property hunt, I’m so excited about this design style I think I’ll try my hand if I land a rancher. The interiors are semi-minimalist but Modern with clean lines, high end finishes and trendy material choices, no travertine here. Formica countertops were also introduced during this period but there’s a variety of other new materials of course that mimic the clean, smooth look for counters.
Hopefully I’ll find the right house to transform into a Mid Century Modern project, were making tons of offers. REO’s, short sales, traditional equity sales and to private party non-mls stuff. Somethings bound to stick soon, stay tuned.
by Tom | Mar 6, 2011 | San Diego Real Estate Market
I’m giving 110%, eating and breathing real estate but still haven’t bought anything. It’s been just over 4 weeks now since rolling into town, sometimes you just have to pay your dues so I’ve come to grips with it now. San Diego is so large and to find deals you have to be willing to cover some ground. This week I looked at about 30 properties and made 4 offers. I know the city pretty well after living here for 27 years but I had to buy a GPS to get swiftly around town to some of these unfamiliar locales. Most of the deals I looked at were on MLS and bank owned REO properties. They are commonly vacant and beat up. Some more than others, its common to see signs of past renovations like travertine tile or faux paint jobs from times when easy money and using your home equity as an ATM machine were so popular here. Many homeowners simply ripped everything out when they left and took it with them. A lot of lenders are opting to paint and carpet and then list for near retail price.
One deal I found early this week in the middle class neighborhood of Linda Vista was listed at $168k. It was a great little 50’s rancher 3/3 with a room addition. I pinned the ARV at $299k. It needed complete kitchen, 3 baths, paint in and out, windows, stucco, flooring, and landscaping. I estimated my rehab budget around $60k, it looked real good so I wrote an offer of $172k hoping to grab it quick. This bank only lists their properties on a website, you are not allowed to submit offers via fax or email. Its like the EBay of REO’s.
Whats neat about this system is its suppose to take out all the double dipping as the listing agent doesn’t even control what gets presented, the bank has direct access to the site and picks the best offer. You have to upload your proof of funds and everything to the site. On the last day someone overbid me by 500 bucks and got the house for $172,500. I should have sat at the computer all day.
My direct marketing is working as well, I’ve got offers out on several really exciting projects so hopefully those will come to fruition this summer. I’ve been networking with some other San Diego real estate investors as well, 2 of these guys have alot of offers out and have even offered me some of their deals so I’m real grateful. When you are chasing Short Sales here in San Diego its common to write offers on 15-20 houses and then wait for 6 months. This is the case with these guys and now some of the deals are getting accepted and they don’t want them all. I feel happy with the progress I’ve made during the short time we’ve been back but still anxious to break ground on the first rehab. Stay tuned to see what I’m going to end up with for the first project…
PS. I’m Still Looking To Network With More San Diego Investors, Wholesalers, REO Agents, Short Sale Agents, Contractors and most of all Anyone Who Knows of a Cool House For Sale, Friend me on Facebook or Contact Me here.
PSS. A Special Thanks to Peter for the lead you sent to me on the Real Cool house!
