Why We Invest in Cleveland. #ThisIsCle

 

You may have read the stories, heard the jokes. But this isn’t the place for people who follow the herd. The city where rock was born knows a thing or two about passion. freedom. and doing it your way. No matter what. Because what they never understood, is that while they were talking about us, we weren’t listening. Under the right conditions, pressure can create diamonds. World-class experiences without the world-class ego. It’s what happens when you’re not trying to be something you’re not. We’ve never been flashy. trendy. perfect. And for that, you’re welcome. Never mainstream. Never meant to be. Always Cleveland

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Affordable Frames for a Picture Wall

Our house looks like its straight out of a catalog.  Unfortunately, it’s for all of the wrong reasons!  Like some of our favorite catalogs, we have plenty of wall art, but none of it is personal.     That is, we barely have any photos of our family.  And by barely, I think the exact count is eight.  Yes, EIGHT photos of our family.  Our parents must be miffed when they come over.  I certainly would be.

The quickest way to go from a grand total of eight photos to twenty or more is through the use of a photo wall, like those pictured above.  While I love the gallery feel of more uniform layouts, the two spaces we’ve dedicated as our photo walls – the stairwell and den – are better suited for a more collaged look.

While the final product is beautiful and can do wonders to liven up a room, many people write off the idea of a photo wall because of the wide variety of frames and, in many instances, their prohibitive cost.  While you can certainly splurge for gallery-quality frames, you don’t have the break the bank for ones that are right for you. If you’re looking for a more random look and don’t care too much about uniformity in size or style, your local estate sale, flea market or re-purposed furniture store is the best place to start.  In that these may be worn, be sure to look for ones that are sturdily built and can be freshened up with a coat of paint.

Should you be more interested in a uniform look, we’ve put together a list of some quality frames at affordable prices.

  1. Multipack Templates for Hanging Frames – If you don’t feel like measuring, this is a perfect product at just $9.99.  It allows you to quickly lay out a template, which can be adjusted, before drilling any holes in your wall.  I bought two.
  2. FJÄLLSTA or RIBBA Frame, like the rest of Ikea’s offerings, are cheap and sturdy.   While we love that each comes in various sizes, they’re made of cheap-looking plastic rather than glass.
  3. Feeling a little lazy? Try the Pinnacle Create a Gallery Set from Walmart.  It comes with seven frames of varying sizes which, like the multipack templates above, can be hung in various formations.  The quality is surprisingly good – real wood and glass – and the frames are sturdy.
  4. Urban Outfitters isn’t just for graphic T’s and summer concert gear. They offer a set of 10 frames, which come in varying sizes, for just $39.  The primary downfall with these is the lack of sizes in the 10-pack, so these frames may be more suitable for a kids rooms or smaller wall.
  5. If you don’t mind spending $100 for three frames, the offering from CB2 is tremendous.  The frames are clean, well built and really do give off the professional gallery vibe.  Mix and match with some frames from Crate & Barrel to complete the look.

Of course, you can never go wrong with Michaels.  Just time your purchase with their regular 40% off sales.

 

The Search Continues…

Oh no!  After being under contract to purchase our first flip, we had to back out of the deal after the general inspection brought to light some serious issues!

I mentioned in a previous blog post that trying to buy a home in the winter is miserable.  With foreclosures, typically the heat and power are switched off, the driveway is covered with a foot of snow  and the overall condition of the home is questionable.  Aside from those physical unpleasantries, the snow in particular makes inspecting the exterior of a home problematic.  If I can’t see the driveway, roof or enter the garage, how will I know if they’re in need of repair?    I do rely on Google Maps satellite view to a certain extent, but even that is only somewhat helpful given that the photos may be a few years old.

To ease our minds, we hired a general inspector (as any homebuyer should) to get their take on any major issues with the home.  And wouldn’t you know, there were quite a few big ticket items!   The biggest of which was the $14,000 needed to build a brand new garage – something we didn’t get to inspect ourselves due to a large mound of snow blocking entry into the structure.  A slight oversight on our part, but alas that’s what inspectors are for.

Regardless of these issues, the home was still a great opportunity – but not at our initial offering price.  So, we went back with a meaningfully reduced offer, which they didn’t even consider.  The search continues!

We put in our sixth offer in the last three months on a beautiful two-family property earlier this week.  It’s a short sale, so it may take some time to close, but negotiations have been going well thus far.  It needs quite a bit of work, but we’re excited by the opportunity to restore the home to its former glory.

Giving My Wife a Bath

I suppose I could have worded the title differently, but it works.

As if flipping a house isn’t enough, our home has been under constant renovation since we first purchased it.  We’ve got a long way to go and the next project on deck is  the full bath on the third floor.  It’s literally gone untouched since we first bought our home, other than being a storage area for random junk.  We don’t use it, even though it has a beautiful cast iron clawfoot tub that is original to the home.  And they’re not cheap…a tub similar to ours retails for $4500 at Restoration Hardware
 
Here is the third floor bath when we first bought the house…aside from removing the radiators (we had a central heat/air installed), the bathroom looks exactly the same.  Yes, even that ugly shower curtain and the A&F Moose hanging from the “towel rack.”  Our third floor is a perfect example of “out of sight, out of mind.”  It’s dark, ugly and uninviting.  Aside from the need for a good paint job, I have quite a bit of work ahead of me. 
 
House Flipping Couple
 
While I appreciate the value a fully renovated bathroom can add to a home, we’re on a budget. Ideally, I’d like to dedicate less than $500-750 to the renovation, the bulk of which will be spent on a new vanity and flooring.  Despite the tight budget, I do want to give the bathroom a warm and classical look, which really can’t be achieved by just painting the walls.  With that in mind, my wife suggested the use of wainscoting, using the pictures below as inspiration. It’s an aesthetically appealing, easy to install and period-appropriate for our home. 
 
Our tub’s hardware makes it a functional shower, but I will likely have that removed and install the “telephone” shower handle.  It’s more appropriate for a tub that will only be used for baths.  Also — love the wall color and use of black-and-white photography. It’s very much my style….BUT…

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While I’m a fan of the more neutral tones in the first picture, my wife is far less bland  and prefers a more lively and bright environment.  Since this will be her space, we’ll likely opt for a more calming and bright paint.  The baby blue screams Southern Charm (in Cleveland?), which is exactly what this space needs.

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To be clear – that’s not wainscoting. It’s beadboard.  And I hate it. Unless you own a beach house in Nantucket, this shouldn’t be in your home. What I do love about this bathroom, however, is the use of Hex tiles. They’re clean, traditional and typically very well priced at $4-5 per square foot.  I also love the contrast between the white tub and black feet, which I may recreate should we choose to install white tile.

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So, there is my idea-book.  The first step is to tear out the floor, trash the shower curtain and put the A&F moose in a more appropriate location. All told, I would expect this project to take 2-3 weekends as I work in piecemeal.  One weekend for the wainscoting and paint, one weekend for the vanity and flooring and one weekend for paint.  So, hopefully my wife can take a nice bath by late April.  Maybe.  Hopefully.

How We Find Our Flips

A few of you have asked how we found our first flip.  Finding a suitable property is pretty easy; that hard part is seeing it before another investor has already placed a bid on the property.

To actually find the homes, we use both Zillow and the local MLS (Multiple Listing Service).  While Zillow is a powerful tool, it usually updates a day or two after the MLS.  As an investor, timing is key because some of the most desirable properties will have multiple bids within the first several days.

The MLS system sends us an automated email each morning with newly active listings in our target market. These listings are filtered based on our criteria, like the city, number of beds/baths and square footage.  While important, I look at those later in the process. The first metric I look at is price (can I make a profit?) and the description (does it read: TLC-needed, DIY special, updates needed, foreclosure, etc).   Oh, and the pictures.  I look at the pictures.  The uglier, the better.  From there, I build my list of potential investments.  It’s time consuming, but I typically do it over a glass of wine.

Once we have a list of properties we’d like to see, our Realtor schedules a marathon showing session.  We spend less than 30 minutes in each home, mostly because touring foreclosures (no power / no heat) in the Cleveland winter is miserable.  Check out a few of the properties we’ve toured and bid on, but ultimately lost to other investors:

FML, indeed!

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The kitchen in my college house was nicer

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Grandmas house

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Not bad, but it still needed some love

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Flip or Flop

Well, we did it. It only took three months of countless showings and unsuccessful bids, but my wife and I bought a home. Not to live in, of course. We already have one for that. This one is an investment, one that we will hopefully sell in the next 6-8 weeks .

But let’s not get ahead of ourselves. There is a lot of work to do…a brand new kitchen…walls needing to be removed … a bathroom to be gutted … Hardwood floors needing refinished … And paint, lots of paint.

3 beds, 1.5 baths and 1500 square feet of pure potential. There is just some junk hiding the potential …

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I’ll post “better” pictures later this week and will keep you updated on all the happenings. The next step is our second walk-through to develop a Scope of Work (SOW) for our contractors and a general inspection on March 10th. The house looks well maintained to me, but its well worth the money to get a professional inspectors take on it.

Zoran & Harriet

Know any homebuyers?

This blog will serve a journal tracking the growth of what I hope one day to be a sustainable real estate investment business. I have high aspirations and have learned that putting goals in writing creates an environment of accountability. If you know what I want to build, then I am more inclined to do it. I’ll share those aspirations at some point, but will for now will focus my writing on the first step…our first flip.

With all that said, do you know anyone who would like to buy a house? If all goes according to plan, we’ll be selling a beautifully renovated home in about six weeks.