<p>I’m just curious if you were renting the low ceiling house or did you resell? Was it tough to sell the house?</p>
<p>Yes, I’ve seen the Owner Occupied REO auctions but they don’t have anything listed in our area. I can bet that these have to be really difficult situations that the bank just wants to dump on someone. Mostly occupants with long term leases that refuse to be bought out. But mentally ill occupants has got to be the worst nightmare in the business.</p>
<p>Ha
You use the term “owner occupied reo” but later on you say “long term lease” aren’t they contradictory? Yes, they are previous owner occupied homes that bank owned. It is extremely difficult to get rid of the previous owner because the bank had tried and failed, now its your term to evict them. You have to be better than the bank to make the price difference. </p>
<p>In this business there is absolutely no free lunch. We earned ever penny and deserved to.</p>
<p>Regarding the low ceiling, do you think you will have problem with your 7’3"? A 7" difference will not make that much difference, if the price is right. The house is on the market forsale, i am looking for an offer on monday.</p>
<p>Continue last night’s thoughts, cannot write too much from my iphone.</p>
<p>You said you cannot find Owner Occupied REO in your area, like applying for college, you have your reach, match and safety. These deals will not come in your reach area, nor it will come in your match area, you have to cast a wider net to some where out of your comfort zone, in a less desirable area. It is hard for me to travel 45 min each way to the areas I am buying, in addition to the difficulties for your “team” to travel that far for works. But, those conditions come with the job and if you want higher return, you need to sacrifice.</p>
<p>In general, the higher priced home, the harder the previous owner will fight for it. My eviction lawyer told me some horror stories about his experiences in San Mateo County where previous home owners filed 5 bankruptcies to stave off sheriff’s eviction. I have a horror story on my own, whereas I spent the whole year to deal with that prior owner and I am still fighting the aftermath of a “Wrongful Eviction” law suit. Had the previous owner accepted “cash for keys”, the bank will own it and sell it as a vacant property, not you.</p>
<p>Its a jungle out there.</p>
<p>Good morning, thanks for sharing your stories Artlover, I have been very lucky not to have had any bad experiences but I know I will hit one eventually. </p>
<p>Our status :</p>
<p>We have stripped 6 layers of shingles off the house and discovered that the original 1x6 wood sub structure is in OK condition except in the roof valley which is completely rotted out. We have to rebuild that structure and we will have to replace many rafter tails that are rotted.</p>
<p>Low ceilings : an engineer friend has come over and we figured out a way to vault the kitchen and breakfast nook and the master bedroom. We are knocking down the wall between the living room and kitchen. Cannot raise living room ceiling because too many roof trusses crossing in the attic area. So you walk into front door and “Cozy” living room to left but hopefully 'the eye will be drawn to vaulted kitchen area. Two bedrooms will still have low ceilings but master vaulted.</p>
<p>Come to think about it, would it be better for you to torn down most part and rebuild? In my area, you can have a “major renovation” by leaving a wall intact. While newly built house would require all those school, park and sewer/water fees. The actual rebuild cost, labor and material for a 1000sf house should not exceed $100K which is not too far from your original estimate and you might have a chance to expand and make it a more attractive deal, if the town allows it.</p>
<p>I thought about it but the permits and ordeal is tough in the historic preservation district. I am thinking about adding enclosed back porch and front porch. I need to find a way to get laundry outside somehow to turn laundry room into 2nd bath. Thinking very hard whether I am going to pull a permit or try to fly under the radar. Problem is that the house is about 4 blocks from City Hall.</p>
<p>Buyers dont care if work is permitted?</p>
<p>Town inspectors never show up?</p>
<p>Great thread.</p>
<p>Yes, I can relate to that. Once the project is in the “Historical Society” you mind as well kiss a year of time good-by. But without pulling a permit, it will be difficult to fill out that TDS when you sell the property. Unless you rent it for two years. How to make “new” to be old and existing is not my expertise. </p>
<p>I have a fair share of fighting the building inspectors, “ordeal” is the word to be used and I don’t want to get into the details.</p>
<p>
Do a permit. It solves potential legal issues when the house is sold (or even some years down the road) and could save you a lot of money - i.e. if you built it and then an inspector noticed it and found out it wasn’t permitted you could be forced to tear it down either partially (so they could check the underlying foundation, structure, etc.) or completely. As a buyer I wouldn’t want to buy it if I discovered it wasn’t permitted properly (and therefore not inspected) - especially if it involved foundation, plumbing, and electrical as yours would if you plan to put a laundry there (and lights, etc.). This is especially an issue with enclosed patios that people try to turn into a ‘part of the house’ but really just enclosed the patio concrete slab which isn’t fit for a true foundation.</p>
<p>And - if you’re vaulting the ceilings and messing with rafters, rewiring, adding new plumbing, etc. you should already be getting a permit for that work which means building inspectors will be on the property. If you’re not permitting that either - well, that’s another problem.</p>
<p>btw - Have you noticed there’s a ‘Flipping San Diego’ show on A&E now?</p>
<p>Is there a basement you can put the laundry in?</p>
<p>Not “smart” to fly under the radar. Pull the required permits. You would be surprised at some of the “dangerous” corners contractors and homeowners come up with that turn up in inspections even when the “plans” clearly state intent that followed code. I know. I’ve also seen people required to tear down things that were done “under the radar” either because they didn’t meet code or didn’t conform to zoning.</p>
<p>I’m curious how you guys work your taxes, with all the flipping. Do you do a 1031 exchange, or just pay the taxes outright? Or is there some other tax advantaged way to do it? I wouldn’t mind selling one of these condos we bought in the last year or two, but the thought of paying close to half the profit in taxes discourages us.</p>
<p>
There aren’t many basements in San Diego.</p>
<p>Some people in smaller homes put the laundry in a closet, washer/dryer side by side (or if really small - a stacked unit).</p>
<p>Can’t 1031 with inventory.</p>
<p>^^You’re saying there isn’t enough inventory out there to buy, to do a 1031?</p>
<p>
</p>
<p>Long term capital gains is 20% tax rate, no?</p>
<p>For a 1000sf house, a nice stacked unit in a closet with room next to it for a narrow pullout rolling storage unit should be fine.</p>
<p>Why don’t houses in San Diego have basements?</p>
<p>This is an interesting thread and will be fun to follow along in real time.</p>
<p>A house went on the market this week that seems similar to the OP’s. It was purchased last year for $780K in not-so-great condition, now on the market for $1.2million. 1300 square feet, small lot. completely refinished, nice for a starter house. Sort of an odd mix of high-end and budget finishes. Front door was fiberglass, windows seemed low-budget, appliances were mid-range, faucets were low-budget, but the stove was a big honking Bertazzoni. Recent comps don’t seem to support the asking price but what do I know?</p>
<p>[380</a> FRANKLIN St | MLS# 81329298 | Redfin](<a href=“http://www.redfin.com/CA/Mountain-View/380-Franklin-St-94041/home/618674]380”>http://www.redfin.com/CA/Mountain-View/380-Franklin-St-94041/home/618674)</p>
<p>99% of the houses do not have basement in CA, not sure why, but may have to do with building costs or the soil structure. Those you have dig down for parking in commercial buildings, the cost for subterranean structure escalated to the extent that unless it is in a VERY desirable area, builder will shy away from doing it.</p>
<p>I would imagine the porch will be a good place for the laundry room, what I DID not buy is a kitchen in the enclosed porch area to make room for space inside. That house is in a good school district and a desirable neighborhood. I could not think of a way to move the kitchen, so I gave up.</p>