CURRENT PROJECTS

ELM DRIVE – DISSECTING A PROJECT

And The Plans Change…

At that point I dove deeper into the due diligence I had already started. One key item (that I had already suspected) was clarified: the little house had essentially been constructed with no permits and was illegally sharing the water, sewer, and gas taps for the mobile home. It had no taps of its own and the county was essentially unaware that it existed. In addition, it appeared to be built either against or over the property boundary line.

Hubby and the GC wanted the house and shop torn down. I could see how the house was becoming a building permit nightmare; but I wasn’t at all convinced about the shop. I am a Realtor and I see clients searching for shops (even ugly old shops) all the time. After attending the closing and meeting the seller my mind was made up. He told me several neighbors had inquired about buying the parcel with the shop. So I made a new plan.

We would focus on the trailer house lot (Elm Drive) and I would put the little house / big shop parcel (B Road) up for sale. If it sold that was fine. If it didn’t then I’d get back to it later… But a buyer got pretty serious and made an offer that included me paying to knock down the little house. I called my GC and asked for a bid on that work so I could decide whether the offer was worth it. My GC dutifully got me the number; but also made a confession. He had fallen in love with the lot and wanted it for himself. He would build his personal residence there. Hubby and I conferred. We decided we didn’t want to make a profit from him. We would have partnered with him in the first place if we’d known his interest was that high. He was offering cash and a quick close. So we sold it at “break even”. He is going to do something great there and it is just going to improve the value of what we are doing on Elm Drive.

Although we didn’t have any permits for building; we didn’t need a permit to destroy. So in a matter of days the trailer and outbuildings were gone; as was the little house and the outer layer of the shop. It is a naked skeleton awaiting its new clothes.

The Acquisition

These parcels were originally for sale, as a package deal, in late summer. I visited the site and submitted a full price offer as did another person. For whatever reason, the attorney handling the estate chose the other offer.

The parcels adjoin each other and had been owned by one individual for many years. There was an older trailer home, a building that housed the laundry and hot water heater that served both properties, a deep shed, a small house, and a large shop. The house and shop were on one parcel and the remainder on another. The parcels were buried in junk, dead cars, weeds, and an old school bus that I really wanted (and immediately dubbed “the magic bus”). In an effort to solve a problem for the estate my offer included a “no clean up” clause. I would deal with whatever they left behind. I also offered to waive my realtor commission. But alas – they didn’t pick me and I moved on to a different project. That was August.

In November the parcels suddenly appeared for sale on the MLS again – and they were asking an additional $60,000 over the previous purchase price. I went to visit the parcels again. The junk was gone (including my beloved Magic Bus) and the weeds had been cut. Other than that, no change. The listing agent said the new owner had discovered that “all the pipes are broken” and that discouraged them from proceeding further with whatever their plans had been.

I made an offer based on that information (nowhere close to the new asking price) and was declined. I offered to use the seller as the bank so they could earn some additional funds via interest. I was declined. The listing agent said the property had not been on the market long enough to consider a lower price. I backed off for a bit.

One December morning I woke up and decided to tweak my numbers to the max and offer one more time. I increased my bid by $10k, waived my commission, offered a quick close “as is”. They accepted.

I had 4 weeks to do my inspections, due diligence and put together a budget and plan.

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