The little house at left is the perfect example of breaking my own rules about houses that work for rehab. These are the rules that work for me in rehabbing:
- At least 660 square feet of finished living space so that all financing will apply. A loan for one of my clients was turned down because the house was less square footage than that.
- At least 2 bedrooms. When one narrows the number of bedrooms down, the pool of buyers gets smaller making the possibility of resale more risky.
- Regular floor plan. Funky floor plans are difficult to live in and again narrows the pool of prospective buyers.
- Reasonably good mechanicals.
- Possible space for expansion.
- Well maintained homes on the same block.
- Buying at the right price.
This little house broke two important rules which worried me when we were approaching resale time. The house was only 562 square feet of living space. That is tiny and limits the pool of buyers to singles or couples with no children. Would financing be available? The second rule broken was the number of bedrooms. It had only one bedroom, although there was unfinished space in the basement with an egress window. Finishing that space could provide a room to be used safely as a second bedroom or family room.
Despite the rules, this little house called to me. I saw it full of character and fine quality inside. I thought of many singles I knew who would love this little house. The floor plan could allow for expansion by building an addition in front of the garage if someone saw the vision. But as it stood, the siding, windows, doors, and roof were all new. The inside was a disaster with no sheetrock, cabinets or flooring. Was the risk worth it? Was the ROI (return on investment) enough? I didn't know but the house did call my name, so we bought it.
As has often happened in my rehabbing career, the houses I fear won't sell, sell quickly; and the ones I think will sell immediately sit on the market. Same quality of repairs, same workmen, but some sell and others don't. This little dream of mine sold in two days. The first person through bought it. The second person through wanted to write an offer, but was too late. My little house is going to be loved by a new owner. I can feel it smiling!