Say hello to our little friend! We have approval from the city to add square footage to the Aloha house and are in the construction phase as we speak.
I want to apologize for not posting more but we have 5 properties that we are buying this month
Been busier than a one legged ass kicker
and have been as busy as one-legged man in an ass kickin contest.
In addition my wife and I are in Mexico for my best friend’s wedding until next Monday.
It was a much needed break and thanks to technology there is quite a bit I can actually do while gone but it really comes down to teamwork and poor Nick is grinding it out in the office while I start my first leg of my trip at our ocean front suite with a jacuzzi on the balcony, at the all-inclusive resort called dreams Puerto Vallarta.
Upstairs “rec room” at Rolando flip
When we got Shannon aka Aloha house under contract we noticed that the city records had only 2 bedroom 2 baths and 1775 square feet even though there was clearly another room above the garage.
This and the fact that the rear of the property was obviously added onto at some point made us go to the city to do a little more research since we were not willing to buy a 2 bedroom for the price we were under contract for.
We were fortunate enough to have a co-operative (bank) seller who gave us permission in writing to go down to the city to pull permits (the County of San Diego will not let you pull building records without the owner’s permission and many lenders specifically state in their contract that you agree not to contact the city about the property.
Brad went down to the city and once he got through the usual red tape and double talk was able to find out that in fact the whole structure was permitted. And
copy of San Diego flip building record
even better news was the fact that 1775 square feet did not include the room above the garage but that the room above the garage WAS permitted as a 320sq. ft. rec room.
Since the rec room was not under the same roof it did not count towards the square footage and was considered just a rec. room.
So long story short and a bunch of time in between we found out that the only way to permit the room above the garage and turn it into a bedroom was to attach it under the same roof..
Well since the seller stated they were selling a 3 bedroom 2.5 bath when it was really a 2/2 we pulled out the old 1,2 punch hail mary. ( We told our agent up front that we were not going to buy it for the price. We were under contract for because of the reasons above and let him know that we could either back out or try to get a credit but didn’t want to jeopardize his relationship with the other agent. He said let’s go for it).
Okay here is the 1,2 punch which is risky in the sense that you will spend some money, time and potentially lose the deal. (I told the agent up front that I was not buying this deal for the price. We were under contract for so this was not a surprise to him.)
Get a professional building inspection
We get inspections on many projects before we buy them because It does a few things
Sees things that I may miss
Helps me come up with a list of items that are easy to fix but can scare buyers. I add this to my scope of work and I require my contractor to have these items fixed before his last payment. I bring the inspector out one more time before I put it on the market and make sure the work the contractor did was okay and have the inspector sign off that I completed the work.
I give the building inspection and my termite report to any buyers before I let them put in an offer, that way they can’t come back and say they want a $5,000 credit because the electrical is not grounded. By giving them the BIR they already know this before they put in the offer. Remember a buyer can negotiate the price down at multiple stages, as a seller you get one shot, once you’re property is tied up the price never goes up.
2. Get a bid on the work that needs to be done in writing from a contractor, submit any information you gathered from the city the sellers maybe didn’t know about (now they need to disclose this info to the next buyer since they now know about it) and justify a price reduction.
This is risky because it takes a lot of time to do it correctly and not just look like your a grinder which only pisses people off and will make them say no, just because they think you are full of it!
So we submitted a bid and in addition Nick wrote a great letter (since he is smarter than me) demonstrating the reduction in value a 2/2 has as opposed to a 3/2
The letter we wrote to the bank asking for a credit
(about $14 per foot over the last 1o years). Here is a quick snipit asking for a $40,000 credit.
Okay so I digress (I write like I think. All over the place so bear with me).
We submitted to the city with plans to add 2 bedrooms (by adding closets to the œrec room above the garage and to the dining room since there was plenty of room to make a living/dining room) and one bathroom to the œrec room.
Well we got approval just after Christmas. By adding 2 walls, 40 square feet of roof and $6,000 dollars / $11 per sq. ft. we were able to go from 1775 sq. ft to almost 2,300. Not bad considering the average price per square foot is over $250 in the area.
Next time, I’ll tell you about some of our new projects and some pretty cool stuff we are doing including another place that we are able to get about 500 sq. feet added just by adding a garage which will give us about $100,000 in extra value!
Stay tuned to the same bat channel and no particular time except when this one toothed man in a corn-on-the-cob eating contest dude gets around to updating this site.
12 hours and I’m off to our second leg in our adventure, Cabo for our friends 40th birthday!
Updated floor plan
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Construction is starting as soon as our plans are approved from the city.
This was the 2nd house fund 2 purchased. Property 1 was the Ocean Beach house. Ok so this deal seems to have come directly from Hawaii, we paid $323,000 cash for this 1775 square foot tropical wonderland.
In addition there is a huge 320 square foot bonus room above the garage that is not counted towards the square footage. In addition to the 3 fountains, there are 2 extra rooms not counting a bonus room and a huge lot
Upon entering what appears the front door you come into a tropical courtyard with coy pond and a sitting area with an outdoor fireplace.
The master bedroom & bath is about 600 square feet that is already pretty much remodeled.
To top it off the shower is a friggin jungle (seriously check out the picture of the shower on the picture to the left!)
To top off the bad boy Jurassic park shower there are two friggin separate private toilets in the master bath for those couples who never want to be apart (see video below – it may take a second to load)
The Love Toilet – For those couples who never want to be apart
It’s located in the Rolando area of San Diego only about a mile from San Diego State University (SDSU) on a great street.
We found this deal through an agent who had seen this before and sent me to take a look at it. I will post at a later time a process I use of finding deals .
Below is the floor plan with the courtyard in the center of the property
THE GRAY AREA IN THE CENTER OF THE PROPERTY IS THE COURTYARD AND CURRENTLY COVERED BY A TARP
Ahhh! so the question is what do we plan on doing to this place as far as improvements go right? Well it has to stay a surprise until a workshop we are holding their this Saturday from 9-12 in which we will tour the property, give a brief summary of the purchase, what sales price we hope to get and a copy of the actual existing floor plan (see above).
After that briefing I am going to discuss construction from the stand point of being an investor who is re-selling the property quickly and the process we go through on making our decisions.
Safe numbers to use before you ever drive the property (if you have some pictures)
Our initial inspection walk through sheet (you’ll be surprised at how simple this thing is and that you probably already have it) we use to give us our first idea of what needs to be done.
Then our quick back of the napkin cost assessment to see if it the price still pencils out before we submit the offer.
Creating a scope to give to a contractor.
Managing the process and basic tricks and traps to watch out for on these projects.
And then we will have everyone break off into groups, walk the property, come up with their scope of work after which we will all discuss and then we will reveal what we are doing to this project including a couple things that may surprise you.
Below is a quick video & picture collage we made of the property. I must not have had enough coffee when I filmed some of the scenes because it is a little shaky so hold on to your hats. Let me know what you think of the video.
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Ahhhh finally we sold our Chula Vista 2 bedroom 1 bath house.
The cats in Chula Vista didn’t use the bathroom like this good kitty did
trying to get rid of the strongest nastiest cat urine smell I have ever encountered (see video below for the smell O’ vision cam)
the 30′ septic pit we discovered (which was supposed to be a septic tank – actual picture)
paying $13,000 in city fees to hook up the septic (pit) to the city.
An appraisal that came in $20,000 to low.
Besides those little things you couldn’t have asked for a smoother, easier, less stressful transaction.
I must have been on a bathroom break (training the cat to pose for the picture above) while I was watching those get rich quick late night Real Estate riches infomercial (those nights I wake up thinking about sink holes, low appraisals, and dealing with city governments) hosted by those two midget dudes.
Does one steer while the other brakes and accelerates?
I just don’t recall seeing my little buddies mentioning those damned septic pits that cost 15 gees to take care of.
In addition they didn’t include the super duper negotiating navigating techniques it takes to keep a deal together with these challenges.
That must come with the more expensive course sold by Tom Vu
The demo is complete and the downstairs walls have been framed out. Our electrician is installing wiringÂ for outlets andÂ lights this week. Plumbing and mechanical is about 85% complete. We visited and took some video for you (Curtis almostÂ sprainedÂ an ankle walking through all that action, but he made itÂ out OK):
OurÂ Home Depot crew helped out withÂ some sleek tile, lights and finishes. It is going to be a very modernÂ home with a lot of light and cleanÂ lines and colors. I mean, take a look at the floorplans as well as some renderings put together by the dynamic duo at HD.
5th, Bullrush, and Caminito Agadir are all slated to close within the week.Â We had to slay a few dragons in the past couple of weeks. An appraisal issue on Bullrush, resolved.Â A sewer issue on 5th, resolved. An air conditioning issue on Caminito Agadir, resolved. Buyers are happy now and all contingencies have been removed, so things are looking promising.
For the most updated information & news on real estate & Gabhart Investments go to our facebook & twitter pages