An Inconvenient Flip: Shifting Real Estate on a Dime
While Jason and I are still enjoying our new house, I want to talk about another real estate experience we encountered.
During the fall of 2006, my partner and I looked all over Indiana for a vacation property to enjoy for the summers to come. We finally settled on Nineveh, a small Indiana town about an hour south of Indianapolis. Nineveh has a series of small lakes with cute properties on its waterfront. After viewing over a dozen properties, our realtor finally decided to show us a neglected foreclosure that needed some work.
We walked into the place and immediately knew that this was the one. It stunk of a nasty wet dog and had noticeable pet hair everywhere. There was also a soiled carpet with a immense water stain underneath a non-working, built-in air conditioner. The kitchen was dark and crowded, not to mention army green in color. There was a bank of cabinets blocking the view of the water and of the living room. The previous owner had also decided to leave behind an old dishwasher that probably had no seal.
Aside from the unfortunately placed kitchen cabinets, the lay-out of this 3 bedroom home was fantastic. There was a master bedroom with its own bathroom, two living rooms, and a partially finished walk-out basement. We were going to make this our dream place!
We quickly started renovating this 1960’s home with elements to bring it back to its roots. We chose to demolish the entire kitchen, replace the windows, and to open up to the deck with some better doors. We also replaced the flooring throughout, choosing a nice carpet for the sleeping areas and hardwood-style laminate flooring for the living areas. The cabinets we chose were a trendy IKEA style reminiscent of a retro European look. This was not going to be the typical Nineveh lake place.
We finally finished the renovations just before July 4, 2007.
Then came the homophobia. We were heading to Atlanta to visit with some friends and decided to check out the new siding that had just completed the renovations. While at this finally finished project, our neighbor let his true rural, backwoods, bigotry shine. I guess after 7 months, he finally chose to put down his Busch beer and let it sink in that we were a gay couple.
We filed a police report and while on the long drive to Georgia, decided that it would be hard to relax in that environment. We were now going to be ‘œflipping’ this beautiful lake place.
We had spent months renovating the property, and adding our personal touch’¦only to have to work backwards and now try to retro-fit the place to appeal to the masses of Nineveh.
We had chosen to use the realtor that had sold the place to us. This turned out to be a big mistake as she ignored us while attending classes to become a broker. (My distaste for the average realtor should be a future post)
We finally chose a new realtor this past month who reminded us about the importance of staging. We decided to buy some inexpensive art work and small pieces of furniture to showcase how someone could live if they made this place their home. It looks great and I’ll let you know how the bidding war ends up.
If you’re an investor, you need to be able to shift on a dime. We had no intention of selling this place but we were now forced to. I’d love to hear of similar stories where you may have had to change your exit strategy earlier than intended.
That is terrible. Put all your hard work into this property and then some a-hole ruins it for you. So sorry.
thats a terrible story! I hope you end up selling it at a profit, and that the new owners annoy the pants off the horrible neighbour. Could it earn you rental income if you don’t sell?
Its unbelieable. 2008 and old minded people still exist!
Wait. Are you sure you should do this?
After an expensive incident of vandalism committed by a hate-filled neighbor who subsequently threatened a judge, my lawyers urged me to sell a house I had just purchased and into which I had poured thousands of dollars in renovations. They believed the man was violent and represented a real threat.
Well, I couldn’t afford to lose that kind of money–if I’d sold, I would have had to pay capital gains tax in addition to forfeiting the investment I’d made in upgrades that I intended to live with for five to ten years (or more). So I got an alarm system, a bunch of digital cameras, and a shotgun and stayed put.
It was worth it. After a year of harassment, the chucklehead and his relatives (who also infest the nearby neighborhood) gave up. Things are relatively quiet around here now, given that it’s an inner-city district. So far I haven’t lost any money on the house, real or theoretical, despite the deflating of the bubble. And as it develops, there are more decent neighbors around here than sh**heads.
Sometimes if you stand your ground with these creeps, they’ll back down.
Thanks for all of your comments.
vh – I agree with most of what you write. I think if this was intended to be a full-time place for us, we probably would put up more of a fight. However, since we were hoping to have this as a vacation place, it would be impossible to relax in that environment. I could imagine him swearing off his deck as we are entertaining on ours. The entire town seems to know him as the town drunk. He is the type of guy who drives his riding lawn mower from his house to his garage. Rumor has it that he is on disability. It would be great to find someone that could “rat” him out…if he is indeed not supposed to be doing manual labor in his yard.