I’ve looked at a couple of hundred-plus year old properties this week that between the purchase cost and remodel cost would not allow a buyer, nevertheless a flipper, to have any chance of breaking even at the end of the project- even if they were discounted 10-15% from their current asking prices.  I this case, break even is what two independent appraisals before and after the remodel would show. I figure after participating in a few higher-end remodels I’ve got a pretty good feel of what it is going to take and cost to do something that doesn’t qualify as a Home Depot remodel (no knock on Home Depot, it’s that they aren’t known for selling premium hardware).

An overpriced rehab project  frustrates me more than overpriced “late model” homes as these properties while not historic by most standards are important to save what makes Portland Portland.  The market has changed for these properties- there are fewer potential buyers, they are harder to finance and they are harder to price.  How do you price a rehab project?  I don’t know how these properties were priced but if it were me, it would have to include a careful analysis of remodel costs and finished value vis-a-vis the “done” houses in the area.

The law prescribes and dictates how lead based paint is to be handled and contained (it did before but not as strictly).  The new restrictions include banning stripping paint with torches.  The change, according to the painter I talked to, “makes it cheaper to replace the siding than to strip it under the new law and repaint.”   The environmental impact notwithstanding, the change in the law is going to change how contractors do business:

In Oregon, many contractors will choose to obtain the “Certified Lead-Based Paint Renovation (LBPR) Contractors License”.  Most residential paint, remodeling, and renovation contractors will need the new CCB license.  Contractors will obtain this license to maintain compliance with the new federal lead-based paint regulations.  The new license will allow them to continue to perform renovation, repair and painting work after the regulation goes into effect on April 22, 2010.

Contractors choosing not to obtain the new LBPR license should cease all renovation and painting work on older homes and other buildings known as “target housing” and “child-occupied facilities” in Oregon (effective April 22, 2010) until they obtain an Oregon CCB LBPR license.

Performing work on subject structures without a LBPR license after April 22, 2010, will subject the contractor to the possibility of severe state and federal civil penalties.

The law also includes window replacement on “target houses” and “child occupied” homes.  Sills are one of the most common places we see paint chips in house interiors.  The combination of moving parts and window ropes that are often painted can cause flakes that contain the lead paint.

Hanley Wood has a much more regional tool for the cost versus value of projects.  The link is to the national spreadsheet but you can drill down into regions and register to download city-specific information which is where the graph below for Portland came from.  The report provides a description of what each remodel project entails.

The graph: © 2009 Hanley Wood, LLC. Reproduced by permission. Complete city data from the Remodeling 2009–10 Cost vs. Value Report can be downloaded free at www.costvsvalue.com.

Guests can enjoy the show, visit exhibits and bid on tremendous packages that will be auctioned off, while enjoying food and wine from local restaurants and wineries. 100% of the proceeds from the live and silent auctions will benefit the Make-A-Wish Foundation® of Oregon. [check out the website for a list of silent and live auction items].

Wristbands for the event will be pre-sold for $55 per pair and will also allow entrance to the show throughout the entire weekend. 70% from each wristband sold will benefit the Make-A-Wish Foundation® of Oregon.

The Home Improvement Show’s hours are:

Thursday, September 24th 2:00pm-8:00pm
Friday, September 25th 11:00am-8:00pm
Saturday, September 26th 10:00am-8:00pm
Sunday, September 27th 10:00am-6:00pm

Guests can enjoy the show, visit exhibits and bid on tremendous packages that will be auctioned off, while enjoying food and wine from local restaurants and wineries. 100% of the proceeds from the live and silent auctions will benefit the Make-A-Wish Foundation® of Oregon.

Wristbands for the event will be pre-sold for $55 and will also allow entrance to the show throughout the entire weekend. 70% from each wristband sold will benefit the Make-A-Wish Foundation® of Oregon.

The Home Improvement Show’s hours are:

Thursday, September 24th 2:00pm-8:00pm
Friday, September 25th 11:00am-8:00pm
Saturday, September 26th 10:00am-8:00pm
Sunday, September 27th 10:00am-6:00pm

There is no perfect world for the laundry location in most houses. If they are in the basement, you probably have more space but the odds are most of washing is being created on the upper floors. A chute is nice but it only delivers it one way. Basements are not always finished to the quality of the rest of the house.

Some people won’t even look at a house if they are in the attached garage (I grew up with them there and it isn’t a deal breaker for me). Its probably the best place for them if there is ever a problem with the water supply or drain.

If they are near a bedroom they may to be too loud to run at night. There is often less space available. Uprights were often considered the considered the sofa bed of laundry: got the job done but not ideal. The modern day front loading stackables have fixed that but keep in mind that the standard for all machines is 27 inches wide. Narrower exist but they are not the norm.

If you have an electric dryer, take a picture or drawing of the socket before heading to the store. There are different layouts and it’s a lot easier if you now which one you need when looking at them in the store.

More Pictures Here! Sorry- link will be repaired.

The roofers had spent the day racing the impending rain and had won. They had laid a torch-down roof and waited over an hour to make sure that everything was okay from their flaming torches. It turns out that the house caught fire about an hour after they left. Thankfully, a member of the Alano Club called 911 quickly and the fire department had an incredible response time and brought all their equipment. I counted seven fire trucks, an incident response truck, multiple police cars and other siren-topped vehicles. The only notable absence was a TV camera crew. Fortunately the actual blaze wouldn’t have made the 10 O’clock news as the fire department had the fire out almost as quickly as it had begun. The scene? Now that was impressive.

Honestly, the worst part wasn’t watching the whole event but listening to the chainsaw cutting through the brand new roof, rafters, siding and walls. There is a complete feeling of helplessness as you are asked to step back from your own home.

We’d called Wildwood with what was probably the best/worst excuse for either being late or canceling a reservation they had ever heard. “We may be late since my house is on fire.” They were very accommodating and told us to get there when we could even though they were closing at 7:30. It turns out that we were there by 7:40 since there is absolutely nothing you can do other than stand in the pouring rain with all the other gawkers while your house a fire scene. We talked with the fire inspector and he sent us on our way.

After a great dinner, we went back to the house with flashlights and surveyed the scene. The fire department had cut a large portion of one of the dormers open (and done a great job patching it back up with a sheet of plywood). There were also cuts in nearby walls looking for other hotspots. And foam, lots and lots of fire retardant foam. It looked like someone’s bubble bath had over-flown. I think the most sustained damage will be from water. Getting the house dry is going to be tough since it is not tightly (or even loosely) sealed. The furnace is cranking away though. We’ve soaked the majority of water out of the wood floors but there is no way of getting it out of the walls and ceilings.

There is a lot of clean up and details to be worked out with the roofer about putting everything back together. Some of the brand new wiring either got cooked or cut. As bad as it is, it could have been a lot worse. If the fire had gone unreported for any amount of time or the fire department had been slower to respond, we would have arrived to a complete conflagration. Equally fortunate was that the house was empty and nobody was injured.

Once checked in, your slip of paper is put in a box depending on what you need to accomplish. My application was first entered into the computer. During this session, we discovered that some of the forms on the web are no longer in use but they are making a concerted effort to correct. It’s better to have too much documentation than none at all. When finished, the slip of paper goes to another box and your name is called. From what I could tell, your initial check in time determines your draw out of each box.

Since we live in the Historic Alphabet District, we have to get special approval for any project that will alter the exterior. I hadn’t realized that this was in addition to the State Historical Preservation Office application that I had already submitted so none of my exterior work was approved. All of my interior work is now permitted and I have the bright orange card that must be posted for all to see.

The staff was kind, helpful and friendly. I was at the cashier in just over an hour from the time that I walked in the door. The process was so much nicer than when I did the same in 2001 for another house.

“Forgot” to get a permit? Check out the City’s “Get Legal Program.”

This picture is the house circa 1900. The oldest picture we have found. The only other old picture we have is circa 1950 and the front porch has already been removed and only stairs remain.

Our new fixer project is none of the above. We’re experienced buyers looking to move in once the remodel is complete. The house is well over the $200,000 price range. The William L. Brewster house is on the Historic Registry as a contributing property to the Historic Alphabet District in downtown Portland. Brewster was one of the city’s first commissioners. The house was designed by the architecture firm of Whidden & Lewis circa 1900. It’s got seven bedrooms and three and a half baths and is just under 4000 square feet plus 1300 square feet of unfinished basement. The first time we did this, our project house was much smaller and we had intended to flip it but made it a rental instead that we still own.

The house had been in the seller’s family since 1943. During that time, it was a boarding house and was also vacant for six years. During the vacancy, all the fixtures were stolen and a major roof leak has water damaged the floors and ceiling through all three floors of living space. The roof was repaired but nothing inside was. Since taking possession on August 19th, we have filled a 30 yard drop box, our utility trailer three times and had a truck load of scrap metal hauled off. There is still a lot of removal to be done since we really haven’t started any construction. Our next step is applying for city permits. We’ve already submitted our application to the State Historic Preservation Office for their Special Assessment Program. That’s another blog topic for another day.

It’s been about a month since we first became aware of the property. I didn’t write about it until now because like all real estate, I don’t believe it until it closes. The sale was a FSBO with a sign in the yard. We negotiated the sales price standing on the front stairs with grandfather and grandson. I think they got a little less than they wanted and we paid a little more than we wanted but the competing offer for more money was going to hack the historic house into smaller units. We were fortunate to have full access to the vacant house during escrow so once it closed; we were ready to start our project. It will get 100% new wiring & plumbing, a new furnace and for the first time, an air conditioner. The oak and fir floors have been inspected and everyone hopes that they will come back to their original glory.

We’ve take a couple hundred before pictures so they need some organizing before posting here. Check back soon. These pictures were taken the day we wrote the offer.

Like all successful projects, plan and get a permit. Before you start, there are some basic questions you need to address. The best place to start is the City’s guide on converting attics and basements.

The first and most important question is: Is it dry??? There is always the potential for water to get in but you want to do everything you can to minimize the possibility. Soggy drywall and carpet is not a happy experience. Even if you don’t plan on finishing the basement, a dry basement is a happy basement (and not so scary)!

Basic questions are access in and out. Stairs must meet certain requirements. We were denied a permit to finish our basement because there was insufficient headroom on the staircase for egress even though there is a completely separate outside entrance/exit. We lost on appeal with the City. Zoning issues must also be considered if it is going to be a separate unit.

Windows must open (out) and be a certain size. Installing the windows can mean cutting into the foundation and installing window wells which also must meet minimum size requirements.

There has to be a certain amount of headroom throughout the finished space. There are allowances for ducts.

Walls must be furred out with studs so that insulation can be installed. Wiring must be done with permits (and your panel needs to be able to accommodate the added load). If you finish a wall and then try to legalize it, the inspector can make you open the wall up to see the studs, insulation and wiring.

What condition is the floor in? Carpet and thick pad can take care of a lot bumps and dips but floorings like laminate and linoleum need flat smooth surfaces.

There is a lot more to the overall project but this is a good place to start. The City of Portland is open late on Thursday night for “Residential Permit Night” so that people can get in during non-working hours. When you go to sell, the Oregon real estate Property Disclosures that you will fill out on the property will ask “Has the home been Remodeled?” “Was a permit required?” and whether or not the permit was finalized. You want to be able to answer “yes” to all of these questions. Anyone can check out recent permit activity on a property with no more than an address on www.PortlandMaps.com