House #36: Budget/Rehab Update

We’ve been working on The WI-1 House for about 3 weeks now, and it’s been a mix of good and bad…

On the bright side, most of the contractors that we’ve brought in have been fantastic — they have been reliable, hard-working and high-quality. Unfortunately, we’ve run into a few issues with the house that have put a strain on the budget.

We originally expected to spend $75K on the rehab, but then decided to do some more extensive changes to the layout, which took our budget to about $95K. I was hoping we’d keep the budget around that range, but it’s now quickly escalated to about $105K, and there are still issues popping up every day.

Here are just a few of the things we’ve run into the first couple weeks:

• When our permits were originally issued, the inspector refused to give us a deck permit without a survey. The survey is adding about $450 to the rehab costs.
• After getting the survey, we realized that our property is a good bit larger than we originally thought; while this is a good thing for resale, it will require us to do a good bit more landscaping than we had planned — to the tune of about $1500.
• We knew there was an old well that needed to be abandoned. We were told that we should expect the well to be about 100 feet deep, and that it would cost about $5/foot to have it filled with concrete and appropriately abandoned (which must be done prior to resale). Well, apparently this well was about as deep as our well guy has seen in this area, at over 350 feet deep! That meant an extra $1300 in cost to abandon it.
• After opening up some ceilings in the kitchen to move some plumbing, it appears that the headers (the lumber that actually holds the house up along the structural walls) are cracked on three of the four walls. We had to have an engineer assess the damage and recommend some fixes so the house wouldn’t fall down — between the engineer’s time and the extra carpentry work, this added about $2000 to the budget.
• Also, when opening up the kitchen ceiling, our carpenters noticed that the guys who built the house did some really stupid stuff. They notched out parts of the joists to build the floor (major no-no) and ran the plumbing through the wrong parts of the joists, potentially impacting the integrity of the structure. The carpenters brought in the city inspector to see what he would require be done…he wants the engineer to recommend something. Looks like more engineering and carpentry work, and some added expense.
• Our carpenter took some measurements in the new master bath space, and things are a bit tighter than we had expected…to the point where the bath probably won’t look good the way it’s designed. So, we had to revise the shower/tub plan a bit, which will add some expense.
• On top of that, to compensate for the inflated budget, we’ve decided to push the level of finishes up a notch, which will both increase the budget a bit more, but should hopefully increase the resale value as well.

None of these things is too terribly major in and of themselves, but when you put them all together — and with me being 1000 miles away — it makes for a good bit of extra work and stress. Once we get through our rough work and rough inspections, I’ll feel a little bit better.

I’ll be in Milwaukee again next week trying to push us through all the rough work, and get us ready for sheetrock, paint and trim, which should hopefully complete in the next 2-3 weeks.