First flip, san antonio, foundation issue- need help

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First flip, san antonio, foundation issue- need help

Lucy Balyan
Investor · San Ramon, CA · Member since 2016 · 61 posts · 15 votes

Hi all, I have photos of my first flip, where to post them? The rehabbers found more issues with foundation as they tried to raise it up a little but now they found rotted beams (1920 abandoned home). They said some of the beams under the home & supporting pillars need to be replaced. it will cost more. The foundation engineer is coming out tomorrow to see what can be done to fix it & cost. Oh man, I wasn't expecting this. I was given an estimate of repairs for $35 to $40k for total rehab. it needs roof & everything else like hvac, bring plumbing & electrical up to code, kitchen cabinets, appliances, floors, paint, etc. Any suggestions? I have the estimated rehab details if someone wants to look at it. I do watch flip shows & I know things can come up. I am praying it's not going to cost alot more. 

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Rick Pozos
Wholesaler, Rehabber and Landlord · San Antonio, TX · Member since 2014 · 2k+ posts · 2k+ votes
10y

I just rehabbed a house in Live Oak a suburb of San Antonio. I paid for foundation work, complete new roof including rotting facia boards, some siding was replaced and some was fixed, all new flooring, gutted and redo on 1 bathroom and complete gut of kitchen with new granite counters, cabinets, all new light fixtures, all new switches and plugs, lots of moving of wires, framed up giant sliding closet doors and replaced with regular doors, a/c was just cleaned and serviced, paint inside and out, and lots of landscaping. This is a 1390sf house in a suburb. Prices are about $95ish per sf. in the area.  All of that was done for 30k. You can upload the photos here. Since yours is a smaller house, and you dont NEED central air, nobody in the area has it, you should be able to get the rehab done for WAY less than 40k.

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  • Rick Pozos
    Wholesaler, Rehabber and Landlord · San Antonio, TX · Member since 2014 · 2k+ posts · 2k+ votes
    10y

    I just rehabbed a house in Live Oak a suburb of San Antonio. I paid for foundation work, complete new roof including rotting facia boards, some siding was replaced and some was fixed, all new flooring, gutted and redo on 1 bathroom and complete gut of kitchen with new granite counters, cabinets, all new light fixtures, all new switches and plugs, lots of moving of wires, framed up giant sliding closet doors and replaced with regular doors, a/c was just cleaned and serviced, paint inside and out, and lots of landscaping. This is a 1390sf house in a suburb. Prices are about $95ish per sf. in the area.  All of that was done for 30k. You can upload the photos here. Since yours is a smaller house, and you dont NEED central air, nobody in the area has it, you should be able to get the rehab done for WAY less than 40k.

    4Reply
  • Lucy Balyan
    OP
    Investor · San Ramon, CA · Member since 2016 · 61 posts · 15 votes
    10y

    Hi, thanks for your response; I know San Antonio is much cheaper than CA for labor and parts; He did give me an estimate up front in detail; Anyway he has $25K so far to use for all the work. He reported about $5000 for HVAC (Heating, Ventilation and AC); Doesn't San Antonio get above 100 degrees? 

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  • Rick Pozos
    Wholesaler, Rehabber and Landlord · San Antonio, TX · Member since 2014 · 2k+ posts · 2k+ votes
    10y

    What I am saying is that you dont need central, you need a big window unit with heater/air conditioner. Sears has them for under $1000. I bet less than 10 houses in a mile radius has central. 

    http://www.sears.com/search=heating%20and%20coolin...

    The house looks pretty rough. I would probably not take on that big of a project. I guess I am just more conservative.

    1Reply
  • Jessica Hood
    Flipper · Winston Salem, NC · Member since 2009 · 159 posts · 32 votes
    10y

    What i have learned about contractors is that they make up their own pricing.  It is much like my job as a web developer.  We know the ballpark for our region and price however we see fit.  For them, it is how long they think it will take based on their guy's history, difficulty, their experience, materials, etc.  What takes one team a week might take another team 3 days.  Point is, you should get multiple estimates.  I look at dealing with contractors like buying a car.  Negotiate negotiate negotiate.  Let them know you are getting other estimates and don't be afraid to share estimates with contractors.  If they want your business, they will wheel and deal.  Some may be uber confident and not need the work, so they won't budge.  But it is always worth a shot.  You also won't know who is price gouging until you shop around.  Just don't pick the super cheap guy with the bad reputation!

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  • Jessica Hood
    Flipper · Winston Salem, NC · Member since 2009 · 159 posts · 32 votes
    10y

    I do have to agree with Rick though... the house looks to be in rough shape structuraly, but that is what you are addressing.  I am no expert, but the one thing I have learned is to be careful with structural problems.  Some are ok and some are just not worth it.  The renovation I am in now required 15 steel I-beams inserted into the basement.  We had hydrostatic pressure pushing the foundation walls inward.  But that was a pretty simple fix.  Scared all the other buyers away though, so it worked out for me!  Shopping around did save me some money on my foundation work!

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  • Jay HinrichsBusiness Member
    Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
    10y

    @Lucy Balyan  is that the pictures of the house you bought. ?

    and your trying to rehab that from the SF bay area.?

    good luck with it.. foundation issues in Texas are a bummer

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  • Lucy Balyan
    OP
    Investor · San Ramon, CA · Member since 2016 · 61 posts · 15 votes
    10y

    Thanks to all of you for feedback.

    I will be going to San Antonio to visit property very soon. I know it looks very rough on the inside & out. I would be scared too as a first flipper but my realtors in CA showed me same type of homes in CA & said some buyers didn't see it as a problem. Anyway, they raised the foundation & found some rotted piers/bears. 

    The JV is with wholesaler, rehabber, John majalca with www.texascashflow.com in san antonio. License #606924 located 904 Arbor place, #1, San Antonio. I bought it for $34k with $35k rehab estimate. 

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  • Rick Maningas
    Flipper · Milwaukee, WI · Member since 2016 · 66 posts · 12 votes
    10y

    In Milwaukee our basements are cinder block that gets pushed in. I love that type of house because everyone runs away. I have my engineer do his official evaluation which includes a repair estimate. His estimate is always higher than what my people can actually do it for. Our basements require beaming and sometimes excavating on the outside to be able to push the walls back out.   Get multiple bids and the cheapest is rarely the best given quality of work, timeliness of completion and staying on budget.  Good luck  

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  • Lucy Balyan
    OP
    Investor · San Ramon, CA · Member since 2016 · 61 posts · 15 votes
    10y

    Hi all, the foundation issues are being worked on (piers & beams). So far $5k for raising foundation & 30 pillars. Another $4k for replacement beams & joist. The entire rehab will be $40k. Purchase was $34k. ARV is min $99k.

    I did a JV with experienced investor/realtor/wholesaler. I could not afford more than $50k purchase with $25k rehab.

    Thanks for Rick Maningas for speaking up & supporting.

    1Reply
  • Account Closed
    Investor · Singapore · Member since 2013 · 1k+ posts · 3k+ votes
    10y

    @Jay 

    @Jay Hinrichs I think she needs more than luck! 

    @Lucy Balyan Id love to hear how this turns out. You are more brave than most of us!

    0Reply
  • Rick Maningas
    Flipper · Milwaukee, WI · Member since 2016 · 66 posts · 12 votes
    10y

    Hi @Lucy Balyan  Thank You for the mention. I'm new to BP and I'm trying to raise my Profile Score. Part of the way to do this is to get "Mentioned" in Posts. I just figured out if you want to mention someone in a post type the @ sign then their name as it appears in their post. Their name should then pop up. If you select it then the whole name will appear in the post in blue and now you have mentioned that person and helped them increase their Profile number. I think I am correct in this. Thank You. 

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  • Lucy Balyan
    OP
    Investor · San Ramon, CA · Member since 2016 · 61 posts · 15 votes
    10y

    @Anish Tolia, thanks for the good luck!

    @Rick Maningas

    my funds are limited and I always liked San Antonio. My family lives in Texas. I know it was risky but I have faith it will turn out good with patience and not upgrading too much; Once we get over the foundation hurdle (damn rain) and roof, we are good to go on the interior. I know many people run away; The area has homes prices from $30K to $200K in 78203. It is revitalizing and close to bus stop, downtown and 2 major highways. I was only looking to make about 15% return on this investment. The important thing is that the contractors show up and actually work. This is why I have a project manager named John Majalca do it for me since I am not there. I did speak to his references. Patience. Good thing I bought it all cash, not HML!

    0Reply
  • Lucy Balyan
    OP
    Investor · San Ramon, CA · Member since 2016 · 61 posts · 15 votes
    10y

    @Rick Maningas I just found out I am not splitting net profits 50/50 at all; 

    it was just the construction cost of $40K ($35K with $5K for cushion for unknown) and the 1% realtor fee for himself for when John sells the property. On his website, he mentions splitting down the middle and making $8 to $10K per deal but I never actually signed anything that said 50/50 split. I only signed the construction cost and the email for the 1% realtor fee.

    It wouldn't make sense to do $40K rehab (which includes $1500 mgmt fee) plus the 50/50 split of net profits plus the 1% realtor fee for selling the property. If he did all this, it would be my last deal with him.

    0Reply
  • Jason Hirko
    Lender · San Antonio, TX · Member since 2016 · 1k+ posts · 1k+ votes
    10y

    I have a bunch of clients doing flips in Dignowty Hill right next to your place. It's great for them but be very careful when choosing finishes. Buyers like so see unique, so stay away from the Home Depot specials! Glad you weren't scared of this flip. 

    0Reply
  • Lucy Balyan
    OP
    Investor · San Ramon, CA · Member since 2016 · 61 posts · 15 votes
    10y

    @Rick 

    @Rick Maningas

    For my education, I scheduled a contractor to meet me when I am there just to give me bids on the interior/exterior part of the work. 

    I called a roofer from Home Advisor.com to go there on Monday via appt to provide estimate, I never heard back from him. I called and left messages. Weird!

    0Reply
  • Lucy Balyan
    OP
    Investor · San Ramon, CA · Member since 2016 · 61 posts · 15 votes
    10y

    @Rick Pozos - thanks for the support & info & for speaking up.

    0Reply
  • Chad Clanton
    Contractor · San Antonio, TX · Member since 2013 · 647 posts · 205 votes
    10y

    Hi @Lucy Balyan, welcome to the SA market! I do home inspections here in town and in the local area; give a yell via email, phone, or PM if you'd like to touch base or have any questions I can help with. Good luck and have a good one!

    0Reply
  • Lucy Balyan
    OP
    Investor · San Ramon, CA · Member since 2016 · 61 posts · 15 votes
    10y

    @chad Clanton- good to know!

    0Reply
  • Tyler Herman
    Investor · Tacoma, WA · Member since 2015 · 84 posts · 42 votes
    10y

    Wow Lucy this looks like a pretty ambitious project. Following to see how it turns out.  

    0Reply
  • Teo W.
    Austin, TX · Member since 2014 · 28 posts · 2 votes
    10y

    @Rick - did you use a interior decorator for the job?  The inside looks nice

    0Reply
  • Lucy Balyan
    OP
    Investor · San Ramon, CA · Member since 2016 · 61 posts · 15 votes
    10y

    Hi All, here are more pics toward foundation repairs; I know I took a big risk here for a first time flipper, out of state JV but its coming along even in the rain. Before this property, I was offered some really cheap ones with fire damage/mold and a bunch of other things for alot less than $34K like $5000K in some city I have never been to or know of and farther than Texas with lots of snow in the fall like Ohio or Michigan but when I talked to other investors locally, they said anything less than $30K not worth it!

    0Reply
  • Lucy Balyan
    OP
    Investor · San Ramon, CA · Member since 2016 · 61 posts · 15 votes
    10y
    0Reply
  • Martin Zagrzejewski
    Investor · Pearland, TX · Member since 2013 · 66 posts · 37 votes
    10y
    You should really check out repair base.net. I can't tell you the value of being able to get your pricing and scope of work made that easy. It's like the bluebook for home repairs. It makes negotiating with contractors very very easy. You can create your whole scope of work made for $10 and it will price all labor and materials down to the zip code.
    4Reply
  • David Rawls
    Investor · Sterling Heights, MI · Member since 2015 · 98 posts · 26 votes
    10y

    @Lucy Balyan Good luck to you! Don't lose that positive attitude and keep moving forward!

    0Reply
  • Lucy Balyan
    OP
    Investor · San Ramon, CA · Member since 2016 · 61 posts · 15 votes
    10y

    Well, someone recently told me if I thought about tearing down and rebuilding a new home; I am pretty sure that would cost alot more than $40K right? I already had someone who looked at the property say it will cost more than $40K to repair foundation, roof, drywall, electrical and plumbing up to code, siding, windows, etc.

    anyone have an idea of cost of tearing down and rebuilding new home for 1063 sq ft? Nothing fancy, just a regular home. Got any contractors to get bids from?

    1Reply
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