Uncategorized

Mold and $5000: Why I feel like Superman

by John Rice

“Do something a person can’t do for themselves or something they don’t want to do and you will always have a job.”

I think my dad said this when I was about 11 years old or so.  It is one of the many things he said to me that has always stuck with me.

I had a lawn care business when I was younger and stronger.  That was clearly something anybody could do for themselves, so what I was doing was something my customers didn’t want to do.

Now I’m a realtor.  To some people, it can look like I am doing something anybody can do.  Sure, people do sell their own houses, buyers do buy without the assistance of a realtor.  The funny thing about it is that those people never really know how well they did…..what did they have to compare it to?  Often, a bad buying decision isn’t discovered until you go to sell.

That is where experience comes in.  I kind of feel like all my life has been preparing me to be a realtor.  I was into architecture as a kid, always drew floor plans, went to open houses and model homes as my hobby.  Took drafting and construction classes in high school and college, worked around building materials at Lowe’s, was an estimator for a construction company.  It’s all helped me to offer something beyond opening doors and filling in the blanks on a contract for my clients.

I recently had 2 experiences that I am pretty proud of:

  1.  I have a client who is building a new home.  We just did what is called a pre-drywall walk-thru.  The builder’s goal is to make sure they have the buyer sign off on where all the outlets and such go before the drywall gets hung.  My goal is to check out the house.  I like to just walk around and look, and look and look.  Besides a few little things, I noticed what looked like mold on the roof trusses.  I sold a newer house to some friends a few years ago.  The home inspector found mold on their trusses.  The trusses are delivered to the site in bundles and sit outside until the workers begin the roof.  If it is really wet, those trusses get mold growing on them and are installed before they dry out.  Ever since then, I am always looking at roof trusses when I have a client building a new house.  It was a real pain for the seller of the house my friends bought, and I don’t want my clients to go through that.  We got lucky this time.  The builder at first tried to say it was dirt, but then agreed to spray something on them that would kill any mold.  That’s a win for my client on several layers, the most important one is their health.  (By the way, the truss in the picture  is cracked, which is also being addressed!)img_1756
  2. One of the most common things I get asked from a seller is what needs done to get their house ready to list?  I had a client whose house had a 27 year old roof.  That is pretty old.  I rarely see a roof that old.  And it wasn’t really in that good of shape either.  He was ready to spend $5000 to replace it before we listed it.  I came out and looked at it.  I told him we should put the house on the market as it is.  If we get lucky, nobody will ask for it to be replaced.  There weren’t a lot of listings available at that time and buyer’s could not be that picky.   We got the home inspection repair list.  Nothing at all about the roof.

So, a little experience got one client a mold free house and saved $5000 for another.  It feels really good to be able to do for my clients what they can’t do for themselves….often simply because they don’t have the experience to know what to do.

 

The house that made me a better realtor

by John Rice

“There is nothing wrong with this house that can’t be fixed.”

Being a young, inexperienced home buyer, these words were soothing to hear from the home inspector.

What I didn’t realize was that fixing everything would take all my time and all my money.

It was April 1st 2002.  Closing on April Fool’s Day should have been all the sign I needed.  I bought what was called a “Fixer Upper” back then.  Now we seem to have shortened it to just “Fixer.”  This was before HGTV, but I had the same aspirations as the home buyers always do at the beginning of the renovation shows.

My house had T-111 siding, which is like grooved plywood and lasts for about 30 years if maintained.  My house was 29 years old.  And it hadn’t been maintained.

It had the old crank out Pella replacement windows.  The kind that after about 20 years, you one day crank to open and the aluminum mechanism inside snaps.  That day had happened on all the windows long before I had ever seen the house.

The roof had two layers on it.  On a positive note, the HVAC was only 2 years old.

As if all this wasn’t enough, the house had a lot of settlement.  That is a nice way of saying STRUCTURAL ISSUES.  The seller gave me an $8k credit for putting piers under the foundation.  The structural engineer (A.K.A.-SALES PERSON) told me the house needed 20 of them.  They were $1k each.  I told him there was no way I could do that since I only had $8k to work with.  Suddenly, he decided that 8 piers would be just fine.

I got what I thought was a bargain. I paid $118,200 and other similar houses were going for $145-150k on the street.

The evening of April 1st, after moving in all day and getting the boy’s beds set up, I decided to take a shower.  As the steam from the shower filled the bathroom, the pea green tiles in the shower slowly started to fall off the wall.  Many had been glued on to what little drywall was left behind them.  It kind of looked like a pizza commercial where the cheese is stretching as somebody pulls out a slice.  The shower had some goofy accent tile that must have been trendy in 1973.  I keep the tile that is pictured below in my office.

Tanforan Tile

Then there was the time we had family over.  I slept on the couch in the basement.  I woke up, ready for my first cup of coffee.  I knew it wasn’t going to be a good day when I heard a splashing sound and my left foot felt wet.  Turns out the basement leaked too.  The seller said they had never had a water problem, although all the neighbors knew otherwise.

But I got a great deal, and there was nothing wrong with the house that couldn’t be fixed.

Oh yeah, now that I am a realtor, I realize that all the other bidders I was up against for this house were investors who were probably offering no more than $90k and wanting to flip it.

So, over the course of several years, I gutted all 3 bathrooms and remodeled them.  New roof.  Some new windows.  New siding. Added a fireplace. Completely gutted the basement since it was wet and moldy.  With some help from my dad and uncle, we turned 2 paneled rooms into one massive space with all new drywall, can lights, new electric and all new trim.

To solve the water issue, I had the leafguard gutters installed, the basement waterproofed with two sump pumps and brought in 3 dump trucks full of dirt and regraded the back and side yard.  Now the house next door gets water in their basement.  I didn’t feel too bad though.  If the builder had graded my yard properly, he would have been getting the water for 30 years.  It was his turn now.

I have always hated this house.  It is sort of funny that I still own it.  We moved out in 2007 and I’ve been renting it ever since.  Part of that is because houses were not selling back then.  Part of it is because after doing all this work to it, I wanted to be the one who benefited from it.

This house was sort of like real estate college for me.  I am a much better realtor having having had these heartbreaking, time consuming and costly experiences.  Having had a house that had just about every problem a house can have and fixing it all has benefited every client I have ever worked with.

And I will never recommend a home inspector who says “There isn’t anything wrong with this house that can’t be fixed.”

Before and after (Circa 2008):

 

My own “First Time Buyer” experience

by John Rice

Back in the late 90s, we didn’t have zillow and few people had the internet.  Searching for a home was about driving around neighborhoods calling the number on the sign, or getting a Sunday newspaper to see which houses were open that day.

I was working with a realtor, but I found a for sale by owner and never thought to call her first.  I was in the car and called the number from my 4 pound cell phone that was 2 inches thick.  I could see the seller get up to answer his landline phone.  Next thing I knew, I had bought a house.

Like a lot of people, I never thought of all the time the realtor had spent with me.  I also never realized how the sum of all the little decisions that she had input on had lead me to THIS house.  I still feel bad about that.

However, I wish she had been involved in the sale.  This was looooong before I became The LEXpert.  I thought “How hard can this be?”  While none of real estate is what I call hard, there is a lot that experience can do to make it a smoother, better process.  I’ve loaded boxes at UPS in the middle of the night.  That was hard.

The seller and I kind of just made up a contract with the help of my mom.  I wish I still had a copy, because I doubt it covered things like if all the appliances stayed, when the seller would move out, what happens if things get sideways and the seller and I need to break up.

I did have a home inspection.  Kind of.  I was a broke twenty-something so a friend of my mom’s did it.  The roof was originally wood shakes with two layers of asphalt shingles over them.  It is a house that today, I would tell my clients to run from.  While we were there, my mom looks at the house two doors down and asks the seller “Is that the house where the shooting was last week?”  The seller told us that that guy only shoots at people he knows.  This is why I keep up with crime and tell people to look at the crime map online.

I had no idea that it was typical to negotiate with the seller to do repairs.  I just thought since I wanted the house still, I would have to deal with any issues.

The seller moving out didn’t go that smooth.  They kind of never fully moved out.  I kept calling him to come get his stuff.  He eventually brought a trailer over to clear out a shed.  As he was loading all the junk, he would occasionally ask if I wanted any of it.  He had several cast iron weights from old windows.  He said they would make great anchors for my boat.  I joyfully told him I did not have a boat, so he could keep them.  This is why I tell clients not to close until the seller is out.  Sometimes I have to be the bad guy and tell the listing agent or seller that they aren’t done moving out and no, they cannot come back later…..we close AFTER we see the place empty.  I’ve had to do that twice this summer.

While this house was a total dump, my wife and I loved it.  We brought both of our boys back from the hospital to this house.   Lots of great memories were made there.  We have since moved 3 times and life has taken me in a direction I always hoped it would.  I’ve been a realtor now for almost 12 years.  The experience of buying this house has helped ALL of my clients because it was one step towards becoming The LEXpert.

Looking at the big picture

by John Rice

Just for fun, I thought I would go through my old blog drafts that I never published for some reason.  I found this one below.  I got a good laugh out of this because I never bought an SUV and I wrote it so long ago that my kids both have their own cars now…..and my dad is retired!

It still makes a good point that is true today:  You’ve got to look at the whole picture when buying a house and any house, unless brand new, will need some of your hard earned money spent on it.

“So, I am thinking about getting a bigger vehicle, maybe an SUV to haul kids to school.  Not too excited about it, so I have a lot of reservations, and find myself trying to make comparisons based more on my perceptions rather than reality.  Then it dawns on me that I am going through the exact same thing that home buyers deal with after they get a home inspection.

See, I am sitting around thinking things like how the tires on my current car have only about 25,000 miles on them, that my brakes are pretty new, and that I just did a major service.  I feel like I am throwing that money away if I were to trade.  Then I realize that I am only looking at half of the whole picture.  If I buy an SUV that still has plenty of life left on the tires and brakes, then I am coming out the same.  Also, since the ones I am looking at all seem to have just over 30,000 miles, they would have just had a major service too.

I think that most buyers deal with something like this after they get their home inspection done.  They start adding the costs of all the problems.  That is natural.  They also usually start to compare the house to other ones they have looked at.  So, at this point I like to try to get them to look at the whole picture like I am trying to do with my car situation.  Lets say House A needs $2000 worth of work on stuff like the roof or plumbing.  House B needs none of those things fixed, so House B must be the better one to go with, right?  Well, House B needs fresh paint, and it will also cost $2000.   When I put it this way, I am sure you see that $2000 is still $2000 no matter how you spend it. (Now I know I have over simplified here, and that most buyers have a chance to ask the seller to make repairs, but this was just the easiest way to make a point.)

My dad is the master of looking at the whole picture.  Seems like most of his friends and family always come to him seeking advice.  The funny thing is that I don’t think he ever really gives advice.  He seems to lead you to the obvious conclusion by asking a series of questions.  He’s like the compassion of Mother Teresa and the wisdom of Yoda wrapped up in a motorcycling, pet loving lawyer.

So, by looking at the whole picture about my car situation, I can now go forward to the next step, which is to decide if it is really something I want to do.  When you get to this point of the home buying process, keep in mind that just about any house is going to need money spent on it somewhere, then decide what you can live with and what you can’t.

What makes a good location?

by John Rice

This week, I’ve been listening to several different buyers tell me what part of town they want to be in.  It has had me thinking about the whole “Location Location Location” thing.  I think most of the time, we as people like to reduce things down to a yes/no, for/against, good/bad scenario……Like this is a good location and this is a bad one.  I just don’t think it is that simple and here is why.

Just this week I’ve had two people tell me they really want to be in a location that many people avoid.  This is a high density area, so the buyers are looking for townhouses and condos.  See, the people that think this is an area to be avoided don’t want to be in that kind of density and are single family home types.  Both buyers mentioned that they had lived in that area before and liked how easy it was to get any where in town and that they enjoyed the 30+ acre park in the middle of the area.  When my wife and I were newlyweds, we lived in this area too…..we thought the same thing back then.

I guess my point in all this is that what makes a good location is really a subjective thing that varies greatly.  Age, income, property type, etc, all greatly have an impact on what makes a location appealing.  There is one common thing that all people tell me they want in a location:  Proximity to work, businesses they shop at, restaurants they eat at, and things like parks/sports/ or places they frequently go.  People with kids like to be in a good performing school district too.

Lexington is big enough to support all these different opinions about what makes a location good.  It is all in the eye of the buyer, and if enough of them think it is a good location, then it must be.