How to Renovate a House with No Experience, No Finesse and A LOT of Enthusiasm
July 2016 - Feelings, Photos & Numbers
My second home purchase happened in the summer of 2016. i was faced with finding a new place to live after a sad breakup. I prepared myself to rent a room in a house with roommates (womp). My salary had climbed to from $43,000 to $53,000 since 2013. While i could have technically afforded it (again, feeling so rich) my frugal brain still wasn't prepared to spend $1300 on a 1 bedroom. I also wasn't prepared to move backward into my first house (cash flow is king). One "Rooms/Shares" craigslist scroll later, I knew there had to be a different option.
Inspired by my very badass friend, Liz, who was buying a fixer upper on the east side, and $backed by my mom who happened* to have some extra money from a recent home sale, I started to search for a deal.
*my mom is incredible with money
Luckily, my mom and her girlfriend, Shanna, were very onboard and looking to invest. They were the perfect partners. We all worked on the same inflated plane of reality. Shanna was the grounder, but my mom and I flew high and employed the confidence of a well-seasoned construction team.
We found the "perfect" 1950s bungalow in my favorite zip (78702). It was a flat 2 mile bike ride to downtown, right off East 7th St. Great bones, gross wallpaper. Some crazy things about this house:
Originally listed for $495,000 (we scooped it for $302,000)
Pictures on the MLS were so AWFUL, I almost crossed it off my list
The garage had been converted into an empty room, with two large storage units (filled to the brim) and hella sparkles in the ceiling paint. I now know this as an Accessory Dwelling Unit or ADU.
Tinyyyy galley kitchen, with wild wallpaper covered in cooking grease ---------->
The sellers had added an "extra room" that was mildew-y, rotting and falling down (picture below)
3 bedrooms, 2 bathrooms, 1400 sq ft
Seller's family had recently installed new windows and new laminate flooring ($$$)
It was an estate sale, which means the owner recently died & her estate was being sold
So. We put 5% down (standard minimum for primary residence), to keep as much money out of the deal to use in renovations. We hired Tony, a contractor who would end up firing many workers and doing most of the work himself. My mom and I were both teachers, so our summer was free. We stayed in whichever room we weren't working on. We slept on an air mattress. We worked from when we woke up, to when we went to sleep. I didn't see my friends, I didn't eat very much and I watched a lot of YouTube tutorials.
Here's what Tony did:
tore down the rotting room and built my screened patio
moved the washer/dryer hook ups from the middle bedroom to the patio
tore down two walls creating an open concept kitchen/dining and destroying the galley
both walls were load-bearing, so he put up two support beams (need house to stay UPRIGHT)
tiled my kitchen backsplash (pretty haphazardly)
secured the new cabinets and butcher block countertops
reworked the "master" creating a bigger closet and a bigger shower (still very small)
plumbed and tiled the master shower
installed the electric tankless water heater (NOT RECOMMENDED - imminent water heater post)
ADU will be a whole different post, but he did a bunch of stuff back there, stay tuned
Here's what we did ourselves:
completely demolished the kitchen
removed popcorn ceilings (MY GOODNESS, WHAT A MESS)
painted every inch of the walls (white, of course)
put up open shelving in kitchen
refinished the living room floor to it's original hardwood glory
taped and floated Tony's drywall
installed built in shelving
put up new crown molding
remodeled the master bathroom
installed kitchen sink (s/o to Shanna!)
landscaped the front yard (s/o to Eric!)
replaced the back door
put up window coverings
installed a wood wall wherever we could (will post tutorial because it's the best accent)
built the kitchen island
So here we are. Renovating a house with no experience, no finesse and A LOT of enthusiasm. Looking back, I would do so many things differently, but it came together. We will never be finished (just right now, I realized that we have a 2 inch gap in the ceiling where some trim fell and I need to replace it ASAP before we are infested with creatures). Here's how it turned out. It took us about six weeks to "finish." I'm sure many of you reading have been to my house for one party or another, but please still look at these pretty afters. Scroll doooown for numbers!
After Six Weeks of Renovation:
Original list price: $495,000 (reduced again, and again, and again)
Final list price: $310,000
Offer/Sale price: $302,000 (multiple offers!)
Appraisal: $315,000 (woo! built in equity!)
Down payment: 5% = $15,100
Closing costs: $6,000
Renovation labor (main house only - see what Tony did above): $7,500
Renovation materials: $6,500
Total cash involved: $35,100
Monthly payment WITH mortgage insurance, taxes & insurance: $2,010/month (since we didn't put a full 20% down)
Six months later, we got the house reappraised to remove mortgage insurance. The house appraised for $408,000, which means the mortgage insurance is permanently OFF the monthly payment. It also means we added $93,000 in value in six months!
Monthly payment with taxes and insurance, but WITHOUT mortgage insurance: $1,790/month
Alan lives with me now, so his rent + Airbnb income: ~$2,600/month
I am responsible for repairs and maintenance, which work out to be about 5% of the monthly payment average. It doesn't come without stress and hard work, but I was able to create the space that I wanted. My mom and Shanna were incredible throughout the process. My mom definitely led the charge. Alan helped a whole lot as well. Anna & Molly came to paint doors! Dan came to rip out cabinets. Rebecca was here through a lot of the ups and downs of the first year. It was her idea to Airbnb the third bedroom! Thanks to everyone who helped even a tiny bit. I'm so happy we did it, and I'm so happy it's over. On to the next..!
I will post about the back house renovation process soon. Stay tuned! Here's a sneak peek: