Can I just start off this post by saying, this feels very vulnerable to share such personal finance numbers as these. But, I truly believe in transparency with money and that it can be a great tool in our lives when used wisely.
Before we dive into the numbers, I feel that it’s important to share the events leading up to this point in our lives. Because numbers mean nothing without the purpose and intent behind them. Some of this may sound familiar, as I shared a little bit of our story in the first Hoarder House post.
Jake and I worked what I would consider ‘corporate’ jobs for the better part of the past five years. This allowed us to purchase our first home, and learn DIY skills as we fixed it up. Throughout the year of 2017, we started doing a deep analysis of our lives and exploring what we really wanted our future to look like.
Let’s face it, a large part of our lives here on earth are defined and influenced by what we do to make money, or ‘a living’, as it’s so aptly called. We were tired of trading our time and freedom for wages. We craved freedom and flexibility with our lives. So we both explored different career options and ideas, and we both ended up switching jobs during the summer of 2017.
I went to a slightly different industry. It was actually pretty much a miracle because it was a five minute bike ride from our home, had an hourly pay structure (no overtime without pay), and 2 days a week work from home! God’s plans somehow always turn out better than the ones we make for ourselves. đŸ™‚
Jake’s job on the other hand, was not so great… suffice to say he spent 10 hours a day twiddling his thumbs and was bored out of his mind. This really started wearing on him, and by November that year he had enough. He quit, turned in his car keys, and was gone just like that!
I felt like this post needed pics, so feast your eyes on my former closet…
It was an exciting and scary time as we got to talk through what his next career move would be. I’m not going to take you through all the thoughts or iterations of the plan (because there are like 6 months’ worth), but eventually we settled on a plan to start flipping houses and start a home renovating business.
We finished up our home renovations and sold our house in March of 2018 because we needed the equity to fund our business ventures. As we were house hunting, we waffled between targeting flip houses, or our next home. If we bought another home (not just a 6 month flip), then we wouldn’t have to live through 2 more renovations, just 1. But, if we did that it’s hard to say if we’d have enough money left over to buy the next house to flip. See the problem?
Well, once we saw the Hoarder House, we knew it would be our next home because we fell in love with the space, the bones, the lot, and the neighborhood. (We are finally getting to the budget part now, I promise!) With that in mind, we calculated how much it would take to fix up the house and quickly realized it would take all the money we made off the sale of our last home, and then some. Clearly we would have none left over for flipping, but we could save money for that future goal as Jake got the renovation business up and running.
Now that the backdrop is set, here are our renovation estimates for the entire house. We will break it up in phases as you’ll see below based on cash flow, because we definitely do not have the funds to complete all this right now.
| Interior Doors | 1,500 |
| Adding Electric | 1,000 |
| Flooring | 15,450 |
| Entry closet | 250 |
| Furnace/ AC | 12,000 |
| Kitchen | 15,000 |
| Laundry | 1,000 |
| Light Fixtures | 1,000 |
| Adding Master Bedroom | 500 |
| Windows | 5,000 |
| Paint | 2,500 |
| Trim | 4,000 |
| Clean Out | 1,050 |
| Clean | 50 |
| Dumpster | 1,000 |
| Water | 1,250 |
| Pressure Tank | 300 |
| Water heater | 450 |
| Water Softener | 500 |
| Bathrooms | 18,000 |
| Basement Bathroom | 1,500 |
| Main Bath | 2,500 |
| Master Bath | 5,000 |
| Plumbing | 9,000 |
| Basement | 2,700 |
| Basement Stairs | 200 |
| Finish Basement | 2,500 |
| Garage | 19,000 |
| Driveway | 4,000 |
| Garage | 15,000 |
| Outdoors | 1,200 |
| Front Deck | 500 |
| Rear Deck | 500 |
| Stain Exterior | 200 |
| Miscellaneous | 2,850 |
| Ceiling Repair Upstairs | 50 |
| Chimney Repair | 100 |
| Clean Chimneys | 400 |
| Fix Gutters | 50 |
| Move in | 100 |
| Outside Faucet | 25 |
| Seal Roof Joints | 200 |
| Seal/Caulk Exterior | 100 |
| Septic Cleanout | 400 |
| Smoke/CM detectors | 50 |
| Thermostat | 125 |
| Tree Trim/Clear Brush | 250 |
| Other | 1,000 |
| Grand Total | 104,250 |
After buying the house, we have around 40,000 leftover from proceeds on the sale of our last home to spend on updates before we need to earn and save a little more money. We started doing back of the napkin math prioritizing the first things we wanted to do:
- the main bathroom – we need at least one fully functioning bathroom
- plumbing – the house required all new plumbing sadly
- furnace/air – there are two AC units and two furnaces and they all needed replaced
- flooring – one cohesive flooring throughout
- kitchen – because we gotta eat
Each of those five things are plus or minus 10k, so it became clear to us that we could only achieve 4 out of the 5 this year. So, which of those to forgo? Certainly not the bathroom, that is a necessity, and the plumbing goes hand in hand with that. And obviously the kitchen is pretty essential as well. Either flooring or furnace/air had to get the ax in this year’s plans.
We waffled back and forth on which it should be…. and then we just impulsively bought the floors. So…. I guess that means no air conditioning?? But wait!!! Turns out we need air conditioning to properly install the floors… so, what did we do? We got the air and furnace done as well. As you are aware, the plumbing is already done and the bathroom is well on it’s way to completion, so that means the kitchen gets the boot. HA! What’s another 3 months of freezer meals?!? Oh boy…
So far, we have spent about this much on the house:
| Main Bathroom | 2,000 |
| Plumbing | 9,000 |
| Flooring | 11,000 |
| Furnace/ AC | 9,000 |
| Doors | 700 |
| Water | 1,300 |
| Misc | 2,500 |
| Total | 35,500 |
I am fully aware that in no world should one ever have a ‘miscellaneous’ expense of 2,500… (and maybe if I sat down with Jake he could help me figure out what all went in this category) They are almost all to Menards, Home Depot, or Ace and vary from a few dollars up to two hundred per transaction. But, that’s the killer cost in renovation, all those little things that add up: a box of nails, more drywall mud, a new tool, dehumidifiers… you get the picture. And you never ever budget enough for that miscellaneous category.
Now if you are concerned that we have run out of money for our kitchen, not to fear, the fire sale left us with some spare change to at least start the kitchen. pretty soon we’ll have to sit down and figure out how far we can get on it.
It feels a little strange to share all these numbers because it’s personal… But hopefully it gives a little insight for you into the cost of renovation and the why behind what we are trying to do.