Investor · Baltimore, MD · Member since 2014 · 78 posts · 48 votes
Like many others, I was originally drawn to the thought of REI after watching too much HGTV, specifically Nicole Curtis' show Rehab Addict. This question is for the seasoned flippers out there...is there any place in the the rehab world for restoring old homes and bringing the charm back in addition to adding modern updates? Would this be profitable as opposed to doing the "typical" rehab or is this wishful thinking on my part?What are your thoughts on this?
Like many others, I was originally drawn to the thought of REI after watching too much HGTV, specifically Nicole Curtis' show Rehab Addict. This question is for the seasoned flippers out there...is there any place in the the rehab world for restoring old homes and bringing the charm back in addition to adding modern updates? Would this be profitable as opposed to doing the "typical" rehab or is this wishful thinking on my part?What are your thoughts on this?
Rachel,
There is a market for true renovation. People in many spots of D.C. and historic areas of Arlington, Alexandria, and Montgomery counties will appreciate and pay for a true restoration.
I think you really have to be in higher end areas for people to recognize and appreciate the value. It can be done in SE DC and PG county but it seems like your buyer will just think you're trying to cut corners, even if it's more expensive to restore something vs. replacing it.
Once you find that market where a true resortation is desired then you just run it like a normal rehab deal plugging in your costs for renovation. I think another key for a true restoration is sweat equity. I watch Nicole Curtis. I think that is one of the better shows and I like that she truley restores a home and doesn't just slap on paint and prefabed everything. Nicole spends a lot of time on site doing some of the busy work that would cost a lot in labor. That might be a key to keeping costs down. Do some of the demo and stripping work yourself.
Besides, I don't know may contractors who really know how to refinish old woodwork and if you pay a company that specializes in historic restoration they'll eat you alive in costs.
Good luck. I really appreciate people who put the extra effort in.
Rochester, NY · Member since 2014 · 83 posts · 19 votes
11y
There is one guy in our area who focuses his whole business on creating custom fences that match the original fence of the historic home. My point with this is if you are passionate about restoration but in your area the "fix and flip" method is not profitable, you may be able to find a niche and be the go-to in that niche market of restoration.
Investor · Boise, ID · Member since 2011 · 1k+ posts · 736 votes
11y
I wouldn't dismiss it completely - I definitely see it as a potential market if you have the right skill set and eye for what that type of buyer wants. We have a section of town (called the Northend) where rehabbed historic homes can go for twice the amount of one that is not updated.
Incidentally, I am a big Rehab Addict fan. Like most HGTV shows though, one should view it as entertainment where you might pick up a nugget of advice, rather than direct instruction. (my opinion).
Rental Property Investor · Lockport, NY · Member since 2014 · 119 posts · 109 votes
11y
I thought this was an interesting end play. This property is across the street and a few doors down from me. I know that the same family has owned it for three or four decades. It was divided up into rentals all this time. I think there were about eight units. Now that they are ready to sell (after decades of collecting rent) they have done a beautiful job of restoring it. I don't know if they will get their asking price but it's a brilliant exit strategy.
Yea the window thing gets me too. She does a lot of questionable things.
Another thing that bugs me
Normal rehbbers would just put vinyl siding these houses & be done with it. She always scrapes & paints.
Yes. These are old houses with old paint, but you never see proper techniques used for lead-based paint abatement.... in this show or in the other HGTV reality rehab/remodel shows. I can't understand that. But, I'm glad vinyl siding is not used, as I do love to see the authenticity and beauty of vintage home brought back to life. I do enjoy watching most of the HGTV shows, especially Fixer Upper. I watch PBS shows like This Old House for a better dose of reality.
Chicago, IL · Member since 2013 · 13 posts · 7 votes
11y
I, personally, think whatever you can do to carve out a niche would be beneficial. Rehab Addict, while ridiculous at times, gave me a lot of confidence that sometimes you just need to get your hands dirty and there is a solution to every problem. People LOVE old houses - well, they love houses with charm - but they want a modern kitchen and bath and updated electrical and all that fun expensive stuff. We bought a Chicago bungalow in Oak Park a year ago and spent a lot of time and money making into what we hope is a perfect mixt of charm and modern amenities. Our hope is to sell it this Spring and do the whole thing over again gleaning from our experience with this first house. If you know going into it that the electrical and plumbing all needs to be replaced then it won't be a shock to the budget. When we have our business model up and running it will be focused less on speed and cost and a little more on details and creating houses people can't live without once they walk in. In my mind this all sounds good but who knows if it will work! If you are passionate about old homes it means other people are too. It will be all about finding that perfect mix of time, money, modern and old that turns a profit. Good luck!
Investor · Baltimore, MD · Member since 2014 · 78 posts · 48 votes
11y
Lisa Maceda You sound like a girl after my own heart. I think there is a place for keeping the classic details and bringing the kitchen, bathroom, etc. completely up to date. My intention is to focus my business model on this, but we'll see. Would love to see some pics of your recent project. It sounds lovely!
The HGTV shows filmed in Canada (mostly TO) depict and strongly encourage abatement and remediation for asbestos and mould respectively. The requirements around disclosure and removal of lead paint in Canada are less stringent than those in the U.S.A., despite the warnings from Health Canada. This may be a reason why fewer of the shows mention lead paint.
Real Estate Investor · Audubon, PA · Member since 2009 · 13k+ posts · 8k+ votes
11y
@Roy N. - Nicole Curtis and Rehab Addict are not based in Canada. Property Brothers and Income Property and Holmes on Homes are from Canada, so for those your comment is true.
Real Estate Broker & Investor · Indianapolis, IN · Member since 2012 · 218 posts · 83 votes
11y
I believe there is a big difference here between a home in an actual historic district, and just an old home. Seems to be some co-mingling of the two in some of the comments. A 100 yr old home can be rehabbed just like any other, though plumbing and electrical may need updated.
A true historic home in a designated historic neighborhood...well that's a different animal, but could still be profitable. Around here, that just impacts what the exterior of the home looks like....paint, siding, windows, etc
Investor · Alexandria, VA · Member since 2011 · 18 posts · 3 votes
11y
Rachel-I do flips in Alexandria VA and as an architect I like to think that my projects keep the historic charm of the homes but upgrade for modern living. For example, my homeowners want open floor plans on the main level. We have to have energy efficient windows but I keep them in same style of original windows. We use trim to match original when it's not custom. I struggle with the same issues you do. I always dreamed of restoring old homes but reality is that I have a budget. I still feel happy with the balance that I've created. I really have to max. out the potential of the homes to make it work with the budget. Everyone is right that these homes need a major overhaul with electrical, plumbing and mechanical systems. In order to cover all these costs, I'm adding s.f. to old historic homes in high dollar neighborhoods. This makes these very expensive flips. Homeland in Baltimore would be a perfect example of a neighborhood that could support this kind of model.
Let me know if you're interested in meeting to talk. I'm actually looking at Baltimore to add some buy and holds to my portfolio. All the Best to you!
Chicago, IL · Member since 2013 · 13 posts · 7 votes
11y
Rachel, these are not the best photos, but here are some before and afters of the first floor. We created an open living area with a completely brand new kitchen. We also finished the attic into a bedroom and flex space (we use it as a TV room), added a half bath, completely remodeled the full bath, and added a huge walk in closet off the master in one of those skinny little awful additions every single little house in Oak Park seems to have.
Before (Living Room) - I know you all want to know where you can buy that sofa, but the owner took it with him :)
After (living room and shared dining area)
Before (dining area and doorway to an AWFUL kitchen - there was about 2' of prep space and only one run of cabinets)
After (living/dining and new galley kitchen)
Before (kitchen)
After (kitchen - doesn't show it, but there are actually two sides to it now!) it took a lot of reworking of closets and stairs, but we needed to rework the stairs anyway to gain access to the finished attic)
This was our first house/very passive investment property so the finishes are a little much for the area in Oak Park it's in. They have incredible schools though so people are willing to pay top dollar to have that zipcode. I don't think we are going to make the kind of profit a true investor would be happy with since the house was a total nightmare when we opened it up, but a lot of those problems should have been caught by us in the beginning. Our exit strategy worked pretty well since we love the house and won't mind staying until the time is right to sell. We financed with an FHA 203k loan. Like Mary said above, if you are knowledgeable about architecture and design and can offer something a typical old (or new) house can't, your crop of buyers will appreciate and pay for that.
It is clear Nicole Curtis is passionate about old homes. My wife and I find her show a pleasure to watch as she is fueled this passion. I know she needs to make a living but clearly she is not in it for the money. Here is a shoutout to her fb https://www.facebook.com/nicolecurtisrehabaddict
(RANT: I may come across as white knighting but it's disappointing seeing a bunch of votes for "I'd like to see her in a bikini")
Investor · Charleston , SC · Member since 2014 · 160 posts · 142 votes
11y
I think if you want to do old/historic homes you need to be in areas where the majority of homes fit this category. Seems to be a lot comments from folks in California where the housing stock is much newer. Not trying to be offensive, but it seems like a lot of folks are making comments on the historic market from markets with almost no historic houses.
For example, if I ever used Vinyl on project it would sit there like a big fat log. All of the projects around me are either going to hardi board or back to wood. It's one of the first things our buyers are looking for and if you are out of step with the neighborhood the house is going to look like dirt.
If you look in markets like Brooklyn, NY or Cambridge, MA you can certainly make a living doing this kind of work. But be prepared the capital investment is on a totally different scale.
Acquisition prices will be around the million dollar mark. Renovation costs will be in the 500k to 1MM range and ARV is going to be north of 2.5 mm to make this worth your time.
Seems a lot of people in the flip business are more focused on the median home in their area (which is smart). So if you want to do historic stuff you need to be in a place where the median home will support what you want to do.
Investor · Boyd, TX · Member since 2014 · 688 posts · 467 votes
11y
I think another very important ingredient is that you either need to have some very specialized skills and be known for them or have contacts with people that have them (very expensive) to really do well in the restoration game. Quite frankly the finish work done in even 100 years ago was so much better than the slap dash stuff most contractors do now that it isn't even funny. My granddad would never have put up with what passes for acceptable building quality now a days.
Flipper · Port Deposit, MD · Member since 2014 · 280 posts · 171 votes
11y
I read an interview one time where Nicole said she was scouted by the shows producers because they were looking for a blonde agent for their reality tv show.
Thats right - the number one factor in contacting her was because of the color of her hair.
Definitely model your entire business plan after this ;)
Investor · Pittsburgh, PA · Member since 2014 · 266 posts · 240 votes
11y
I don't know much, but I can imagine that it would be much easier to run a successful rehab business when the rehab business itself is nothing more than entertainment and you can rely on HGTV's parent company for your paycheck. Of course, you can then parlay your "expertise" into FREE informational training seminars in which you provide aspiring house flippers the "opportunity of a lifetime" and grant them access to your "nationwide database of distressed homes" for a cool 30 grand per person.
See how easy it is to flip houses profitably?!?11?!
Yes, I am a cynical a**hole regarding such matters.
Mooringsport, LA · Member since 2014 · 25 posts · 31 votes
11y
I am a big fan of the show income Income Property and to me its more real than most of the others and from what I gather the home owners get a 35% discount off of the total price plus free staging and professional photos.
It is clear Nicole Curtis is passionate about old homes. My wife and I find her show a pleasure to watch as she is fueled this passion. I know she needs to make a living but clearly she is not in it for the money. Here is a shoutout to her fb https://www.facebook.com/nicolecurtisrehabaddict
Big difference between "not in it for the money" and "not getting paid on the basis of the sale of the flips".
Not sure what you mean by this? Like inflating numbers? I don't recall seeing any sales figures on her shows.
I would guess she is not a natural business person and may not understand the value of her time but if you do what you love for work you never work a day in your life. People that build their life around passion are the most pleasant to be around. When someone devotes much of their resources and time to "their cause" it may not make logical sense. Decisions are emotional, not logical. I can also understand how another would make decisions based on money first because they need to provide.
Specialist · Pelham, NH · Member since 2013 · 547 posts · 269 votes
11y
@Kurt Kwart , I was as surprised as you on the votes, but the fact is it's a TV show, people watch it because she's hot, not because she's a good contractor. I've seen her do so much illegal stuff I'm amazed the EPA hasn't fined that show out of existence. In her opening, she pulls some cover paneling off of some balusters and yells something like "Oh my God! Why did someone cover these!". The first thing that comes to my mind is they were covered over because they were painted with lead paint. But hey, let's just go ahead and leave them exposed, it makes for good TV.