Over the better part of 2019, our family embarked on a new and exciting journey that we’ve wanted to do for a lot of years. We never thought it would actually be a possibility because of the financial implications of purchasing a second property, but we figured out a way and I hope that maybe I can teach and inspire someone else to do the same thing.
I’ve always been retirement focused. The idea that one day I will want to enjoy time not working is important to me and the reality is that no one is going to be there to take care of Crystal and I, so it’s on me to plan for that now.
We’ve done some investing, but investing is dependent on what we can add. Sure, every penny helps, but we haven’t really been making much of a dent anywhere. Thankfully, I’m pretty savvy at investing, it’s one of my passions. Through blessing of a Christmas year in the stock market, one of our Roth IRA’s grew an eye-popping 49%. I say that, not to brag, but to encourage that it’s possible.
But that’s not enough! Something more needs to happen. Residual income is always better than investment returns. If you can find a way to produce residual income that’s not based on your time or energy, you have uncovered something profound and incredibly profitable! Think about it, you can really only work one job (and maybe a side hustle if you’re lucky). Most people have a primary source of income, but what happens if that primary ever goes away? One day it will!
So over a year ago, Crystal and I started looking into purchasing a reno property. Knowing that I had the tenacity to face just about any construction issue. And she had the courage to believe that we could face any obstacle, we chose to believe that reno’s weren’t scary!
I remember it well as I looked at this house for the first time mid December 2018. I say properties didn’t scare me, but that’s after I renovated this house. The moment I walked in, I walked back out and said, NO WAY! It was way over my head. For some reason though, I was too stubborn to avoid it!
On December 27, I made my offer, signed it and waited. It was bank owned, so it wasn’t really much of an issue, I had some extra info and knew that I was the highest bidder, so it was just a matter of time. I found out two days before my closing date that there was a residual tax problem with an estate tax that had not been paid. It was excessive, over $7,000, but it was not my problem. It was the banks, so I waited for them to figure it out. Three months later, I was ready to pull the plug and walk away, but it actually turned out to be a gift from God. This was the same season that my wife had been totally incapacitated medically and I couldn’t have done anything on that house anyway.
However, at the end of March they had figured out a way to make it work and we were able to close.
The last Saturday in March became demo day one and demo we did! We tore out all the water lines, the entire bathroom down to the studs, carpets, the entire kitchen and the ceiling in the back area of the house.
Demo day stretched on for a time as I had to figure out how to make the house work more efficiently. I had to demo the stairway as it was not up to code and dangerous! The treads were only 6″ wide! Tread depth, by code, must be at least 10″.
The house was originally a 4 bedroom, one bathroom home. It had a hand dug basement/crawl space. Two bedrooms were upstairs, the other two on the main floor. Nothing was in the basement other than a laundry space and water heater. There was a gaping hole in the wall in the basement that was used as a coal shoot years ago, but currently served as the entrance for any varmint and rodent that wanted an inside space to chill out.
The space was not configured well at all. The bathroom was super tiny. Consuming only 36 square feet, it was one of the smallest bathrooms I’d ever seen, and in a 4 bedroom house! it made no sense. That had to be changed.
It made no sense to have laundry in a mud basement either. How would someone ever feel that their clothes were clean!? That had to be changed.
The kitchen needed to be reconfigured as well. The placement of the kitchen sink and the stove were fine, but the ceiling height was terrible and the cabinetry far past expired.
By far the biggest issue the house came with was the termites and dry rotted floor joists.
When I first went into the house, the listing agent was eager to show me the extent of the damage found in the living room and adjoining bedroom. I’d never seen something so destroyed! Walking into the bedroom, the floor literally felt like a sponge beneath your feet.
How could anyone have lived in this house!? It had been vacated only 3 months prior and through a forced removal.
The evidence of an army of cats was clear, especially in that room as they had clearly chosen it for their place to play and pee. The stench was something horrid!
When I walked into the basement that was a muddy mess, stepping over the dead rodents on the floor, you also had to dodge the strangling pieces of joists that were crumbling overhead. I could literally pull the joists apart from the dry rot and termite damage!
If the joist damage wasn’t enough, it was the main supporting beam that really did me in. Not only was this main support holding up the entire house as rotten as the joists, but it had also be severely compromised when a plumber cut through half of it so a drain pipe could be fitted to the kitchen sink.
Through that first visit, it took me just 5 minutes to write this house off as out of my league.
But I’m stupid.
And stupid is as stupid does.
And so I bought the house.
You see what I learned through all this is that anything can be fixed.
Anything can be accomplished through determination and resilient effort.
Seven months after closing on the property, we had people moving into it. It took my wife just one week to rent out the property.
We had the time of our lives pouring into this house and we learned so so much in the process.
My boys learned the value of really hard work.
Grayson, my 8 year old, learned how to use a nail gun (with me really really helping). He also learned that although insulation between floor joists looks like you can walk across it, you actually can’t!
They all learned that demo is a lot of fun! And Messy!
I learned that aside from my passion for gloves, my new found joy is Tyvek Suits! Amazing!
I leave you with some pics of the process and outcome.
Tell me your thoughts and if you would have what it takes to take on a Fixer Upper!?