Buying and Renovating an Investment Property

Buying & Renovating a Rental Property: A Homeowner Tell-All

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One thing I haven’t talked a lot about on the blog throughout the years is that we’ve slowly been collecting a portfolio of investment properties we buy, renovate to the best of our abilities, then rent out. It’s why—paired with the fact that our business has been booming and requires us to be on the road a lot of the time—we haven’t had as much time (or money) as either of us would like to continue to tinker on the Victorian. It wasn’t something we necessarily set forth to do, but SVV and I did move here from California just over seven years ago with the intention to become homeowners, and Tennessee property is notoriously cheap, even more inexpensive than we anticipated, particularly once you get out of the Nashville metro area. Plus, we’re both self-employed, and while we contribute the max annually to our SEP (IRA), it’s still not going to be enough for retirement someday, so we need to have a back-up plan.

And that’s how we came to be investment property owners.

Buying and Renovating an Investment Property

As you can tell, it’s a glamorous life indeed!

One of these houses, in particular, was the house right behind ours that went up for sale almost two years ago. SVV had been manifesting this acquisition for some time; it was a dilapidated old building used for commercial purposes with a single employee nearing retirement, but the house looked into our yard and kitchen, so for privacy purposes, we wanted to figure out a way to make it our own. We live in a commercial district, so all of our “neighbors” go home between the hours of 5pm and 7am—except for the apartment building caddy corner to our Victorian that also looked into our backyard and was finally condemned two years ago after a couple instances of drug dealing out of its doors. This only made us want to own the house behind us even more, to control who was allowed to live or work there.

Buying and Renovating an Investment Property

Myrtle, circa 2017

SVV had made friends with the lady working there, as he so often does, and one day I was going out for a run when she sauntered up our driveway and asked to speak with him. It turned out that she was being laid off (so sad) and that the owners, an out-of-town law firm, were going to sell the building (an opportunity for us). I’m grateful she came and let us know before they listed it, as we were able to swoop in, make an offer and close two months later without it ever going on the market.

Buying and Renovating an Investment Property

Myrtle, circa 2017

We named her Myrtle for the pair of crepe myrtles that really dress this gal up in warmer months.

Buying and Renovating an Investment Property

Let’s be honest here: SVV was in from the moment he was this basement!

We don’t know when Myrtle was born, but we estimate based on the architectural detail that she came to be in the 1940s. She had been neglected, as so many projects that seem to fall in our lap have. The woman who worked there had smoked, so the walls and ceilings were stained with nicotine, and I could barely step foot inside without coughing. She had good bones, though, and really, isn’t that what every lady of a certain age wants to hear?

Buying and Renovating an Investment Property

Buying
Buying and Renovating an Investment Property
Buying and Renovating an Investment Property

The lingering question was: But what would we do with her, this house we kind of bought without much of game plan? The idea has changed so many times in the past few years. At present, we are preparing it to be a commercial property for a law firm or CPA office, as we’re in a commercial zone and pay exorbitant commercial property taxes, so might as well, but before that, she had a short life as a vacation rental.

Buying and Renovating an Investment Property

Here’s how we went about fixing it up to do just that.

We had all brand new windows installed

We used the exact same company, Satisfaction Windows, who made our custom Queen Anne windows for the Victorian, and I love how they match. This was by far the most expensive thing we did for the rental house, but I really think it elevates it as a whole, not to mention increases Myrtle’s longevity and energy efficiency. If you’re going to paint the exterior, I’d recommend doing it first (we didn’t have that luxury because it was winter), so you don’t have to painstakingly mask off all the windows.

Buying and Renovating an Investment Property

We replaced all the electrical

A few years back, we met Mark, a God-fearing electrician of a man and a military vet, who has come to help us rewire so many things in the Victorian (and even saved us from a potential attic fire created by Squirrel Team 6 who had gnawed their way through our wiring). Anytime we’ve had a job of any size, we’ve summoned Mark, but this was the first time we needed him to rewire an entire house. Since we were simultaneously working on several other projects at the time, he typically came out in four-hour chunks a couple days a week over a three-month span. SVV, being a renaissance man who worked previous jobs in construction, sheet metal work and flooring, among other things, assisted him, which dramatically cut down our labor cost for rewiring an entire house, which was a lot more laborious a task than I ever assumed it would be. While we sourced many of the items from a local electrical supply house, we also shop for materials and supplies at Home Depot, and also Lowe’s.

Buying and Renovating an Investment Property

You can order everything you need to wire your home here.

We replaced all the plumbing

This was another PITA chore that took weeks, if not months. SVV had done plumbing on our own house, and our friend John was a plumber in a former life, so we traded video production for him helping us to re-do the pipes for the whole house. But still, there was plenty we had to do ourselves, and next time, I think we’d find someone to do the whole thing for us. SVV used PEX, which in his words, “is a game changer for DIY.”

Buying and Renovating an Investment Property

You can check to see if your local Home Depot has what plumbing supplies you need here.

We knocked down walls

Myrtle is now a gloriously open floor format with a lot of natural light. But she did not come into our hands that way. She had been used in all manners of ways, so came to us with weirdly separated rooms, a checkout counter and way too many doors. We removed a majority of the doors and carefully deconstructed the offending pieces. Don’t use a sledgehammer. Only television personalities that want some drama do that and it makes a mess!

Note: If tearing down walls that are not temporary, you need to check with your local codes office about a permit. Our codes department came a callin’ once they saw us pulling out trash to the sidewalk, but we weren’t actually removing any permanent structures so we were in the clear.

Buying and Renovating an Investment Property

We gutted the master bathroom

Myrtle has three bedrooms, a full bathroom and a half bath. For the half bath, we replaced the toilet and vanity and painted, but it’s OK as is. It’s also ADA-compliant so we didn’t want to change much. But the other bathroom is a different story. This is what we were dealing with going in:

Buying and Renovating an Investment Property

This is what it looked like after we ripped off the walls, tore out the floor and took a sledgehammer to the porcelain. Not much of an improvement, eh?

Buying and Renovating an Investment Property

But we made it our own and tried a few hacks SVV concocted, and I think I’ll leave that to its own post down the pipeline.

Buying and Renovating an Investment Property
Buying and Renovating an Investment Property

We painted the interior — sometimes as many as three coats

We have an awesome Sherwin-Williams down the road in Tullahoma from which we buy all of our paint, but you can also find many SW products on Amazon and get free shipping if you aren’t close to a Sherwin-Williams of your own.

The interior product we used for Myrtle was Economy Interior Latex Flat Wall Paint. Because of the dark-colored walls pared with the nicotine seep, yellow spots emerged after the first coat on the ceiling in the front rooms, so we wound up having to apply a second, stain-blocking primer then a third coat of finish, though typically two will do the trick.

Buying and Renovating an Investment Property

Buying and Renovating an Investment Property
Buying and Renovating an Investment Property

We painted the exterior

Since the building is behind our Victorian, we matched the colors for simplicity, painting a pure white on the shingles and Sherwin-Williams’ English Ivy on the eaves. The white and green makes for a clean and crisp look that should hold up well over the years. SVV replaced some of the cracked cement boards with these handy, matching shingles, removed the decorative shutters and patched holes before priming it from tip to tail and applying the finish coat in a semi-gloss (Duration Exterior Acrylic Latex from Sherwin-Williams).

Buying and Renovating an Investment Property

We painted the front door

This was a task I tackled a couple weeks ago on an unseasonably warm 70-degree February day. I used Sherwin-Williams’ Tricorn that we had left over from one of our mural projects, and I absolutely love how it turned out. Now I just wish the door didn’t have those ugly brass furnishings. The Schlage lock is the same keypad system we have on our own house and all our other rental properties. We love it so much, we give it out as housewarming gifts to friends.

Buying and Renovating an Investment Property
Buying and Renovating an Investment Property

You can check prices for all Schlage keypads and buy them here from Home Depot.

We furnished it

We didn’t want to go wild with what we put in there, so it’s a pretty basic furnish job, but we did move some expensive office furniture from my Dad’s old office pre-stroke, bought all brand new mattresses and bed frames, and added a few personal touches and art from our own home.

Buying and Renovating an Investment Property

Here’s where I’m going to tell you the biggest tip I learned in this renovation process: DO NOT ORDER FROM IKEA ONLINE. We had a nightmare of an experience where the orders kept getting pushed back weeks, sometimes months at a time, and wound up arriving three months late—just days before our tenants moved in. IKEA’s customer service was less than helpful, and upon doing some online digging, I’ve learned that this is pretty common—that online orders from IKEA rarely arrive in a timely manner.

Should you take advantage of cheap furnishings at IKEA? Absolutely. I just wish, in retrospect, that we had drove the three hours to Atlanta or Memphis and filled up a truck instead of relying on a highly unpredictable fulfillment process. Repeat after me: “If I buy from IKEA, I will go to the store and not order my furnishings online!”

We did buy nice mattresses from Cocoon by Sealy, which cost us nearly $2,500. That said, we waited until they were running a sale and got them about 25% off.

You can check current Sealy pricing here.

Buying and Renovating an Investment Property

I also recommend keeping Macy’s in mind for both mattresses and couches when you’re shopping for your rental home. I’ve found their prices to be more economical than most, particularly if you hit them up near a holiday weekend.

Check for mattress deals at Macy’s here.

We decorated minimally

Most of the furnishings and accents were things I sourced from our home—a lot of Urban Outfitters pillows and prints that had been collecting dust in our attic—because we didn’t want to spend a lot on art if we weren’t going to keep this as a for a long time. Small things like trash cans and toilet paper holders I grabbed in TJ Maxx and Home Goods. Also, I finally joined Ebates during this process, which got me a lot of cash back on all my purchases ($800 in the past year, woohoo).

You can use this link to sign up for Ebates, too; it’s free and easy.

Sloth Animal Print from Overstock

For art, I enlisted Overstock to find these darling animal prints that came framed. We opted for the gray frames, and I picked the sloth print, giraffe print and llama print, though Overstock has pretty much any animal you could ask for available.

Check here for all Overstock art, much of which is on sale.

I also scoured TJ Maxx’s home decor section, as well as Target’s wall art. I really love all the Project 62 art, and much of it is often on sale if you watch the website.

Check here for all current Target home decor deals.

We listed it on Airbnb

We didn’t actually even have to do this as we already had found renters for the summer via friends, but we did go ahead and list it as a vacation rental to bring in some excess income once they were gone.

Note: If you’re new to Airbnb, you can list on there and get an automatic credit by signing up through this link. We’ve also listed vacation rentals on VRBO, HomeAway, Zillow, etc., and Airbnb is honestly the only service I would recommend. The others are so clunky, and the UX is terrible. Go Airbnb or do it yourself. You can also list on Airbnb for longer-term rentals, which we’ve also done to avoid having to get our own liability and damage insurance (they cover up to $1M).

I’m not sure how much we spent on this project overall as we’ve tinkered away at it for the past 18 months as our schedules allows, but here’s a rough estimate of what we spent on each task:

  • Windows: $5,400 (material and labor)
  • Electrical: $3,700 (parts and labor)
  • Plumbing: $1,900 (parts only)
  • Interior paint: $800 (material only)
  • Exterior paint: $1,200 (material only)
  • Dumpster rental: $350 for two weeks
  • Bed frames: $450 for a total of six
  • Mattresses: $2,140
  • Toilets, vanities and bathroom fixtures: $1,400
  • Furnishings and miscellaneous: $1,000

We estimate to date that we’ve spent a total of between $20,000 and $25,000 fixing up Myrtle, which isn’t that bad if you consider her age and the fact that she hadn’t been touched in decades. Also bear in mind that other than the windows and the electrical, we did everything ourselves, which saved us a lot of money in labor costs.

Buying and Renovating an Investment Property

There are a few other things we still need to do this spring before we put Myrtle back on the rental market: paint the curbs, apply porch paint to the entryway, blowtorch the back door and paint it, sheetrock the bathroom, paint all the interior trim and possibly replace the roof (if not now, then at least in the next year or two).

My advice would be to prioritize your list, tackle all the big things first that are within your budget and then save tasks like the roof that aren’t necessarily immediate for when you build back up your reserve. We definitely drained our savings account outfitting Myrtle, but I’m hoping putting the time, effort and money into creating a really nice rental property will pay off in the long-term.

Buying and Renovating an Investment Property

Note: We purchased everything in this post ourselves, but I’ve done my best to track down every item online and link you to the best deal. I’m using affiliate links when possible, meaning it’s no cost to you, but I’ll receive a tiny commission to help keep the blog lights on.
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COMMENTS
  • February 18, 2019

    Oooh, I’ll have to look for your listings if I’m ever in the Nashville area! 😛 We would love to some day do this as well, but it could never happen while we are in San Francisco.

    • February 20, 2019

      We don’t have any short-term rentals as we’re all 30 days or more, but I can gladly point you to some really great ones owned by friends. There are SO many cool Airbnbs in Nashville!

  • February 19, 2019
    Joan van Velsor

    Beautiful job! How this story does bring back memories of a certain Portland Victorian when Scott was in his infancy. He absorbed the DIY inclination, and has made it his own with amazing talent.
    Partnering a van Velsor in a rehab endeavor is an education and, almost always, a joy.
    Working together, sharing skills and energy is such a wonderful life. You guys are doing it more than full time!

    • February 20, 2019

      I still need to see those photos to believe it, particularly a mini Scott working with a hammer 😉

  • February 19, 2019

    I haven’t clicked through to one of your posts in a while ( sorry – but see – you shouldn’t cull your list as I do ) but we’re pretty much in the same situation right now. After 6 years of travel we’re home. Fixing up our house. It’s been rented the whole time we were away to long term renters and now we want to Airbnb it or short / medium term let it. But it’s such a slow job ! My websites, my kids, my life, just get in the way of restoring the garden and painting walls. Well done for getting so much done ! Today we need to get onto mulch and finishing a bedroom. I really want to be out of here, fast. I miss the travelling lifestyle.

    • February 20, 2019

      It’s so hard to renovate a space you’re living in, isn’t it? That’s why the Victorian has been the never-ending process! We tackled a bunch of it before we moved in, but eventually there comes a time you just have to move in already. With Myrtle, it’s been (marginally) easier because we were never living there and we do almost everything to it before moving what little furniture we have in!

  • February 19, 2019

    Hi there,
    We turned our 2nd home into a rental and rented it out for about 6 years. We sold it last year to upgrade to a new house that we are having built. I hadn’t thought about doing AirBnB – are you going to do that exclusively or will you look for long term rentals? Also, sorry you had such a crap experience with Ikea. We ordered online with no issues other than a couch we had to assemble. I know it’s Ikea but who knew you had to build a darn couch lol….. Nikki

    • February 20, 2019

      You can actually do long-terms on Airbnb; there’s no time limit that I know of. So we’ve listed on there for up to 12 months, and it’s been really nice to find tenants! Obviously, you still have to fork over a service fee, but I find that in certain demographics, that’s where people go to look for furnished rentals. For the area where Myrtle is located, Airbnb isn’t the best fit, though, so we’ll look at listing locally as we just want commercial renters, not residential tenants.

      • February 25, 2019

        I never even knew this! Great info.. thanks for sharing – Nikki

  • February 20, 2019

    Truly, real state investment is good choice nowadays. It may not easy to renovate but you’ll gonna enjoy your retirement to the fullest. 🙂

    • March 1, 2019

      Yes, agreed! Especially working in the media where rates have gradually dropped in the 15+ years I’ve been an active journalist.

  • February 22, 2019

    But wait… where are the cute interior after photos!? I demand a Part II! 😉

    • March 1, 2019

      It isn’t cute is the problem!

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