State street is in play with repairs. Our little house on Moreland is going to be done in the next three weeks or so -we've placed a date of August 25th as our goal. We're meeting our good friend to discuss options on the Moncure land tonight, and we have identified three or four other opportunities to look at more closely. We also are setting a rough schedule for the first Box Bend Home project on one of our three lots. Our intentions are to work on the "Home" portion of our business over the winter months when sales slow to a crawl. If it comes to fruition, this will keep our contractors busy over the winter, and will also prevent us from burning u the remaining summer and fall daylight on things that may not produce until next spring. Instead we can use that daylight to put a few of our projects into play and possibly squeeze in one or two more.
This is a great way to start the day; a few things brewing on the back burner, and a few things steaming in our cup.
Stay tuned. And Good Morning!
Good old State Street is seeing some action. Unfortunately, it is not the sales type of action, but it is action none-the-less.
The single biggest complaint that we received on State Street was the sloping floors. (This is an old, old house.) We were told more than twice that all the houses in the area had this condition and that no one expected the floors to be perfect. In one instance, we were told that the slightly sloping floors (in areas) were part of the "charm," of the house, and not to worry about the floors. In another instance, we were told that a similar condition existed in a nearby house and that it had sold "quickly."
Well, guess what?
We have been idiots. We should have trusted our own instincts and desires on these issues, instead of listening to "experienced" opinions. Don't misunderstand, this is absolutely no one else's fault except our own. And we point this out today because it is critical for anyone that wants to be in this business to realize that accountability starts and stops with the individual or company that owns the projects or homes. So, knowing that we have acted like idiots, we are taking our very expensive lesson and revamping our approach to State Street.
We are ripping up the floors and possibly some tile, and our contractor is going to work on fixing the floors. How much will this lesson cost us? Well, suffice to say that it is more than a little. So, in addition to carrying costs, reducing the price on the home numerous times, and now paying to "redo" the floors, we are talking about a good year or two at a less expensive state-ran university or college.
Now the good news.
The good news is that if we sell the house, we will list it once again, but at a higher price. (It is currently not listed and we have not signed an extension on the listing.) If we keep the house and rent it out, we will be able to command a few more quid for our efforts. If we decide to rip off the roof and add a third bedroom and a bath, we will have an adequate foundation and base (most of these homes are built on pilings or piers), because our contractor will need to work with them in order to level the floors. SIDE NOTE: Our contractor did something similar on a project that we are working on in Durham, NC.
The neighborhood is gentrifying rapidly. Every time we drive through it, we see new renovations, and escalating prices, on properties within a four or five block radius of this house. So, to put additional spin on this event, it may have been a blessing that this property has not sold just yet.
None-the-less, on a long list of expensive education items, this one has ranked right up there as a more expensive course. Hopefully, if you are reading this, you will be smarter and much more savvy about these things. Additionally, our hope is that we have helped with your education at a fraction of the cost. If so, please feel free to leave a comment. Thank you in advance.
It has been a crazy month or two. We have hit progress stalls due to delayed permits in Durham. We have waited with baited breath for the and in Sanford to come off of the buy-back option we granted the seller. And we have made some hard decisions about the State Street property. In addition, we have had some personal items pop up on the Box Bend team that have robbed us of concentration where it counts -on the business. And then there is that whole tax issue.
Don't misunderstand; we are not against paying taxes. (Even though we could have an extremely long discussion on how our tax dollars are being utilized.) Rather, we, as a company, as Box Bend, need to get over this hump of building up our portfolio and then taking down part of it during the tax season to cover tax obligations. We think we have part of the solution now, but it has been a real consideration with the business.
Remember; this website is for those who want to follow along as we renovate homes and move into other related areas. The idea for this blog was that others may want to do what we are doing, so we decided to create a site where people could look over our shoulders -this site.
So, if you are getting into this game, we would like to point out the obvious and tell you right now and here that you are going to hit roadblocks. The choice will be to soldier on and come up with solutions, or to lay back. Actually, we advocate both approaches. Lay back and THINK about what needs to be done and what makes the most sense. Consult your trusted partners -realtors, contractors, lawyers, spouse, etc, and work out the best solution for the problem. THEN, and only then, soldier on. Marshall your strength and resolve and keep going.
In the case of the taxes, we are taking X percentage (currently about 30%) off of the top and putting it in an account specifically for taxes. Once this account grows to a certain amount, we will look at short term, extremely safe, and liquid plays for the money -in between tax obligations. (Might as well get that money employed and out of the basement as soon as possible, as well.)
In the case of delays and direction issues, use the delays to keep up on the opportunities in the market, to understand what is going on in your market (where are you in the almost inevitable cycle of boom to bust), and what each cycle condition means for your business, and to make your flexible plans for the future. One of the big mistakes out there is to jump without knowing where you are going to land. This is a novice mistake in our humble opinion. It is akin to bidding up a property at auction due to ego, or worse, wanting to get into the game. These are all mistakes that we have made. And this brings up a final point: take down time and use it to access performance. What have you done right? What are you doing wrong? What do you need to know that you don't know currently? What do you know that you can use as a lever for gains in the future?
In short, keep a notebook or a journal. Or a blog. Or both. We always tell ourselves (and others) that this life is not a dress rehearsal. So, if it is not a dress rehearsal, what are you going to do with your limited time on stage?
Have a great day and stay tuned.
PS Rushing out the door this morning, so advance apologies for typos, fragments (which we actually dig), and other gaffs in our writing.
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