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Lead based paint  is commonly found in houses that were built prior to 1978.  Most areas of the country now require a lead certificate or approval before the home can be rented or sold after being remodeled.  Lead based paint is considered toxic and should always be removed by a professional.  It is typically disposed of at toxic waste sites or in some cases landfills.  

Lead paint should not be vacuumed, burned or sanded.  Any of these methods either release lead particles or lead smoke into the air which causes more problems.  Chipped lead based paint is commonly found in areas such as windows sills, floors, base boards and moldings where it can be eaten by young children.  If you believe there is lead paint in your house flip or remodel be sure to call a local lead mitigation service.  You can find them on the Environmental Protection Agency website.   Be sure to check out more house flipping tips by clicking on the House Flipping Tips category. 

The best way to save a few bucks on your house flips is to do some of the work yourself.  Of course most of us are not qualified which is why we pay people in the first place.  One area that does not require special skills is demolition.  You might think to yourself “This is a no brainer”, but be careful.   There can be a few hidden problems with demolition.  Besides the obvious back breaking work of slinging a sledge hammer and rolling out the trash to the dumpster, there are also potential hazards.

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Good question.  The answer nine times out of ten is yes.  Small jobs such as painting, minor changes of bathroom and kitchen fixtures will not require a permit.  However if you plan on doing anything electrical, plumbing, HVAC, structural, landscaping, etc a permit is normally required.  It also can save you money in the long run by avoiding costly fines, and stop work orders.  When you go to sell your property, you will be able to disclose to the potential buyer whether not you pulled proper permits.   There can also be insurance problems when collecting on fire damage when a permit was not used to do the renovations.  Better safe than sorry I say. 

Did you know your utility company gives discounts and rebates for your flip?  Depending on your project and whether or not you are holding or flipping, this can mean considerable savings for you or your tenant.  The discounts are normally available when you buy energy saving appliances, install additional insulation, replace old air conditioners, space heaters, install double pane windows, and many others upgrades. 

The return comes in the form of cash vs. a loan, and can cover anywhere from 50 to even 100 percent of the cost of the qualifying upgrade.  You will need to check with your local utility company to find out more information.  In some cases you need to apply before the work is performed.  The utility company may want to inspect the work before final approval. 

I’ve waited as long as possible and the Hopkins Biotech area project is back in rehab mode.  The HVAC work has begun and should be ready for rough in soon.  I still have not received anything from the city.  As far as I’m concerned there is no reason to assume I ever will.   I realized a long time ago that I cannot trust anything that I am told or even given in writing from the development corporation that is responsible for the area project. 

I feel a lot better moving forward again anyway.   Each day that my property sits, I loose money and it’s sat for most of the last 10 months.  I can no longer afford to keep paying out and not getting anything back so I am forced to move forward.  If they decide that they are going to acquire it, they should pay fair market value based on the renovations and COMPS for rehabbed properties in the area.  I am prepared to fight tooth and nail for anything less.

I will be showing fewer pictures but I promise to show some shots after major phases of the project are completed.  I should be starting the Old East Baltimore Project soon.  Once that happens, I plan to focus my blog on that project from start to finish.      

There are many ways to buy and sell real estate.   The main objective for a real estate investor is to make money.  In a down market like the one we are in now, many house flippers are jumping ship.  This opens the gate for the ones that choose to continue and whether the storm.   The question still remains.   How can I make money investing in a down market?  Much of what we see on the house flipping television shows and what we read in house flipping books says that houses should be flipped quickly.  The longer we hold them the more they cost.  While this may be true if you are carrying the note without a tenant, it does not mean that you cannot make just as much if not more by holding the house over a longer period of time.  Many houses are sitting on the market for a year and counting.  This is where the lease purchase exit strategy can pay big dividends. 

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Kitchen cabinets come in various shapes, sizes, colors and most importantly for this post…prices.  Too many choices are not always good when it comes to making a final decision.  House flipping on a small budget allows you to narrow down the choices quite a bit.  I prefer solid wood cabinets in my house flips and luckily there are many choices.  Hard woods such as oak, maple, cherry and ash tend to be a little more popular and therefore a little more expensive.  Also the availability of hard wood continues to decline which also adds to the price. 

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Making sure that your contractor cleans up behind himself may seem trivial but is more important than you might think.   Some homeowners associations and local building codes require cleanup according to strict rules.  You can and will be fined for leaving debris and trash on the exterior and even interior for a prolonged period of time. 

Cleanup Clause  

Make sure that you always have a clause in your contracts that requires the contractor to clean the premises each day.  Be specific as to how clean you want the property to be after the work is complete.   I like for my contracts to read something like the following: “Premises should be cleaned each day and in a broom swept condition upon completion of work prior to final payment”.  Depending upon the contractor I also include a line that states that all remaining building supplies, remnants from demolition, tools, and anything associated with the job should be removed.

I’ve decided to write a series of posts about house flipping on a small budget.  The purpose of this series is to discuss the use of materials that are lower in cost but without sacrificing aesthetics.  I typically use high end materials i.e. granite countertops, hard wood floors, all wood cabinets, ceramic tile, Kohler faucets and fixtures, etc.  Occasionally there are times when the budget is a bit tighter or the location allows for a little less flamboyance.  One material that has come a long way over the years is linoleum.

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Well today I found out that my bank will no longer be offering rehab loans to investors.  This is a huge blow and the timing could not be much worse.  I was banking on this loan for the most recent property that I landed through a foreclosure auction.  My loan officer is attempting to get my loan through since it was already in progress, but there are no guarantees.  I’m not sure how this is going to affect my other loans but we will see.  In the mean time I will need to line up other financing.   I had become comfortable with this banker and the relationship was in place.  Its time to start a new relationship all over again! ARRGGG!!!!!  I really dread having to do this, especially in the current mortgage market.

As a business owner or entrepreneur we must remember that quitters become losers.  If we are easily discouraged by roadblocks or even failures we will never win.  If we learn from the experiences and continue to push on we can do nothing but succeed.  I’ll keep you posted…