The first section of this post was written by my husband who is not only my other half but also the other half of this business & blog. I don’t give him nearly enough credit on here & he isn’t on social anywhere so you’ll just have to tell him in person just how much you love the post below!
The Raleigh, NC property has been the most rewarding and fulfilling property purchase to date. I truly felt like we helped this family out of a bad (and deteriorating) situation.
The Backstory
I first had the opportunity to speak with the owner/seller in March of 2020. It took nine months and several phone conversations before the seller, we will call him Michael, agreed to schedule an appointment to have me meet him at the property in Raleigh.
I arrived at the property a few minutes early and noticed an older gentleman sitting inside the garage. I walked up to him to introduce myself. He asked what my business was so I told him I was there to meet Michael to take a look at the property he was interested in selling. The older gentleman immediately slammed his hand on the table he was sitting at and said, “I AM JOHN F. DOE AND THIS IS MY HOUSE AND I AM NOT SELLING!” I asked John why Michael would have called and asked me to meet him here to discuss the sale of the property. John said that he had no idea and I’d have to call Michael in order to figure it out. By now it’s fifteen minutes past our scheduled appointment time. I apologized to Mr. Doe for the confusion and went back to the truck to call Michael. He answered immediately and said he forgot about our appointment. We rescheduled for a few days later. When I asked him about John emphatically saying he wasn’t going to sell, Michael informed me that John was his father who happens to be 99 years old. Michael hoped to sell the property and move his father closer to his home in Winston Salem. He also explained that within the last few years, John had added Michael and Michael’s sister, Mary, to the deed.
A few days later, I traveled back to John’s (and Mary & Michael’s) house for our rescheduled appointment. This was also the first time I was able to meet all of them in person; we all took a seat around the kitchen table together. Very quickly I realized there was a lot of tension and animosity between the three of them. We went over what we (Craig & Meredith) could offer them for their property. We came up with a number that we all agreed upon and worked for everyone. The problem was that Mary was unwilling to move out. MOVE OUT? At some point, Mary and her husband had moved in upstairs. John lived downstairs. Next, Michael offered to walk me around the exterior of the house while John and Mary stayed inside. He told me that Mary and John’s relationship was deteriorating by the day. The police had been called several times to the house; it was a toxic environment for John to be living in. Michael said he already had an apartment reserved for John in Winston Salem so he felt it was time for everyone to move on.
When Michael and I went back into the house, Mary was visibly upset. Voices started to raise so Michael asked Mary to accompany him to another room so they could talk privately. This gave me the opportunity to sit down at the table with John and hear about his amazing life. He told me he served in the military during WWII. Now he had my undivided attention. Not that he didn’t have it before… but I was definitely dialed in now! (Meredith note for context- Craig is an avid history buff, especially war history ;)). Turns out, he served in North Africa (what?!) and drove in a resupply convoy in the campaigns against Rommel. After the military, John got a job with the public school system where he worked for forty years. THAT doesn’t happen anymore. Well definitely not that often. I was enjoying our conversation so much that I hadn’t realized that Mary and Michael rejoined us at the table.
Mary sat down with her arms crossed, still unwavering. She said she couldn’t afford to move out and wouldn’t consider it. After a few more questions and a lot more conversation, we touched on the fact that John had bought the house with cash. That right, cash – there was never a mortgage on the property. At this moment, I got out my calculator and divided my purchase price by three so Mary could see how much she would make for the sale of the property. This got her attention. She immediately uncrossed her arms, sat up, and leaned forward. I wouldn’t say there was a smile on her face, but it damn sure wasn’t the frown she was wearing when she first sat down with us. Next we began to discuss what options Mary and her husband had for moving out. We agreed to a reasonable time frame that would allow them enough time to find another house to purchase. I even offered to rent back to them if they needed more time to find a new place. Mary and her husband took a few minutes to discuss their options and ultimately decided moving on was the best outcome for them, as well. At this point, all family members are on the same page and ready to sign the contract. Mary and her husband found a new house fairly quickly so we didn’t have to keep them in as short term renters. We closed on the property and prepared ourselves for the remodel process.
I’d like to thank my husband, Craig, for that excellent recount of what it was like sitting down with the sellers in order to purchase this property. He put so much work into following up with Michael for months trying to set up a meeting, then having the awkward job as family mediator/counselor at the buy appointment. I couldn’t imagine trying to manage the hostile relationship between the family members and actually helping them come to an agreement. It’s honestly what makes Craig so great at what he does!
The Rehab
With all of the work Craig put in to acquire the property on the front end, luckily the rehab ended up being fairly simple. As it turned out, our scope of work was purely cosmetic. The sellers left behind a lot of furniture among other things, which we expected. When we say we buy properties “as is,” that not only refers to the condition of the home, but also to all the items/junk/trash sellers choose to leave behind. Honestly, it’s a relief to many sellers as the financial expense can be costly but also not having to bear the emotional expense of cleaning out many years worth of possessions. We contracted a local junk removal company (shoutout to Count Junkula in Raleigh for offering great services, fair rates, purple dumpsters and incredible branding) for clean out. Once all the furniture and junk was removed, our hope that the house was still in decent condition was confirmed (insert sigh of relief).
The roof, HVAC, and water heater were all relatively new. The areas that needed the most repairs were the carpets and cabinets. The carpets were all stained, old, and worn. Since all the furniture had already been removed, it was just a one day job for A1 Floors to come through and replace all the carpet upstairs and downstairs. The house had those ever-popular thermofoil cabinets which had started to delaminate in some areas. This is very common in an older house that has thermofoil cabinetry. Truth be told, these cabinets or more specifically, the thermofoil is designed to fail after about 20 years. The cabinet doors and drawers are made of MDF (medium density fiberboard) and the “foil” is glued to the front and back of the door and drawer faces. Eventually the glue fails and the foil starts to delaminate. This process can be accelerated if the thermofoil is exposed to heat; typically the cabinets next to the range or dishwasher begin to delaminate first. The cabinets themselves were in pretty good shape so we decided to remove the foil and paint the cabinets. Hold tight… I’m going to write up a separate blog post on the process of removing the thermofoil and painting the MDF for you guys!
The only other issue we found was in the flooring underneath the refrigerator. The fridge had been leaking for some time which caused the hardwoods underneath to disintegrate. Fortunately, the water didn’t leak past the hardwood. We removed the damaged pieces and searched local hardwood distributors for a match. I thought it would be like searching for a needle in a haystack but unlike most issues we encounter when trying to match materials, we actually found a similar style in stock at Lumber Liquidators (now LL Flooring). We were able to weave in the new flooring and slide the fridge back into place.
As soon as the repairs were complete, we listed the property for sale. When we first purchased the property, we calculated our ARV (after repair value) around $275k. We decided to list the property for $300k with the idea that we could be talked down to our original ARV, if need be. Little did we know that this was the beginning of an extreme sellers market. We had showings scheduled every 30 minutes and multiple offers after the first weekend. We accepted an offer that was $20k over asking and closed just three months after we purchased the property.
Overall, this was a HUGE win for us. Prior to purchasing this property, our only experiences with rehabbing properties were drawn out, over budget, and very stressful. This was our first flip where we didn’t have any major drama (see Our First Flip House, Our Second Flip House, or Our First Mobile Home Flip) which was a nice change of pace and great confidence booster. Although Craig spent more time and effort into purchasing the property than we did fixing it up, it was well worth it in the end. We bought the property for $185k, spent $20k on cosmetic repairs, and sold for $320k.
Check out the Before & After photos here.
*Disclaimer – The names and identifying details of the individuals included in this post have been changed to protect their privacy.
Meredith Worrell 