Update from the trenches

IMG_20150906_144044502 IMG_20150906_142214447 IMG_20150906_142209634 IMG_20150906_142206569

 

I had a family move out in relatively quick fashion last week.  I was informed (via phone call) of a musty smell in the house.  That day (a Saturday), I installed a dehumidifier in the basement.  Two days later, I received another call to inform me that a much more significant problem must be present.  I called a local mold mitigation contractor (who immediately informed me they would simply bill my insurance company…scam much?)

The local contractor did actually visit the house, but refused to provide a fixed quote.  They simply said “we’ll let you know how much it will be when we’re finished”.  Unfortunately, I’m not in a position to accept a contract on those terms, so I decided to handle the kitchen remodel myself.

I have a list of ‘must be remodeled at some point’ projects and this kitchen is a part of that list.  The kitchen will be finished by Thanksgiving, hopefully before.  While tearing into the walls, I found original newspaper articles the construction of the house.  Most dated from 1890 and 1891!  Philipsburg had great sarsaparilla, some sort of ‘Indian loans'(?) and an active corset market.

Needless to say, I found very little mold, except a little under the kitchen sink.  I will be fixing the sources of water (leaky pipes) and reinstalling a kitchen.  I’ve decided to go for some San Francisco charm and rather than install $600+ upper cabinets, I will use some black iron pipe:

Black Iron Pipe shelving

Let’s hope the final product looks half as awesome.

The Law does work!

Water damage

Back in February, I wrote to my Congressman concerning the increase in my flood insurance for UFUO #2.  The cost of insurance had increased almost 400%.  According to the law, that was illegal.  I wasn’t sure how to proceed, so I emailed my insurance carrier and my congressman.  No one had any answers for me except “well, it looks like the insurance company is correct”.

Well, without any warning, I received a check and a letter explaining that the law (which was in effect when I paid my premium) restricted the premium to only 18% over my previous premium.  The check was for the difference (with the full 18% increase in place).

I’m not sure why it took so long for me to receive the money, why the only answer to my emails was “it is what it is”, but it all ended up working out in the end.

I still have to figure out if they can again increase the insurance 18% again this year, or if I’m spared that increase.

(Photo credit: water911damage.com)

Waxing Philosophic about Leadership

john-locke

The above picture is not me.  The guy in the picture is long dead.  His views influenced Thomas Jefferson, according to the “Top 10 Greatest Philosophers in History”, was a great liberal (he just doesn’t have the beard to prove it).

This is John Locke.

So, you ask “why am I going to read about a dead philosopher today?”  Good question.  You’re not.  I’m simply going to touch on some philosophy that’s been rattling around in my head for a few years.

I’ve held a philosophy about people for some time now.  I was unable to articulate my views, but I had these very closely held beliefs about how people operate, the environments in which people thrive and 99% of humanity’s desires.  I can not point to one specific book I read, one pivotal moment in my life or anything like that.  I simply attribute my views to a keen observation of people, self-awareness (still working on this one), my formative years and my non-formative years (eg: work years).  Finally, in one of my classes, we discussed and expanded on my views; not because I decided to talk about my philosophy, but rather because the professor teaches leadership and this is his philosophy, and mostly, because it appears to work in most situations.

I’ve felt the following:
– People need honest feedback and feedforward, both good and bad as long as it’s honest
– People respond positively in environments in which they are able to make their own choices
– Honest listening is not simply nodding and agreeing while formulating my rebuttal (or addition) to the conversation, but rather is clearing your mind of all other distractions while learning from the other person (and everyone has something to teach, however small)
– People need a framework from which to work, but near full autonomy within that framework (don’t micromanage)
– Rewards work (punishments work as well, just not as intended)
– People need to know that they are not just a number or a cog to be replaced at ease.  Each person is an individual and that person adds to humanity’s greater good

In class, my professor listed a bunch of points for Leadership.  These points are:
– Develop a vision
– Simplify the message
– Trust your subordinates
– Be an expert (and know when to ask questions)
– Encourage risk (Go easy on failure)
– Invite dissent (have the ability to listen to different points of view)
– Keep your cool

In addition, my professor hammered into us that true leaders are “Servant Leaders” and what he termed “SuperLeaders”.  Servant Leaders include some of the best leaders we can remember: Gandhi, Lincoln, MLK Jr, the list goes on.  The first (roughly) two minutes of this clip from Gandhi (1982) sort-of demonstrates what I’m talking about: https://www.youtube.com/watch?v=WW3uk95VGes  This isn’t the best example, but it’s along the lines of what a Servant/SuperLeader does.  A SuperLeader is a leader that leads others to lead themselves.  Think Demi Moore’s character in A Few Good Men (an exceedingly good movie about leadership).

While I was unable to articulate what a leader is or does, I knew what it meant to be a leader.  This class was finally able to explain it to me in a way that I can attempt to explain to others.  This class taught me why some people are ‘leaders’ but they have trouble leading without ‘authority’.  Think Kim Jong Un, Col Jessup (Jack Nicholson in A Few Good Men), the Mob Boss, maybe your personal boss.  They say “Do this because I say so”.

There is a middle category of leaders who allow processes and procedures to guide their interactions.  Think Lt. Kaffee (Tom Cruise in A Few Good Men), many many many bosses.  They may say “I got here by following these rules, so everyone will follow these rules.”  Or, “If I develop these policies and procedures, the company will function better.”

The third category of leaders establishes a value system and leads simply by living the his/her value system.  Lt. Cmd Galloway (Demi Moore in A Few Good Men), Lincoln, Gandhi, MLK, maybe you even add religious leaders to the bunch: Jesus, Muhammad, Gautama Buddha, etc.  Some of these leaders were extremely vocal, others not so much, but look at what they all accomplished: freedom from tyranny in the US, non-violent resistance to oppression in India and the US, any of the major religions.  While these leaders have died, their ability to lead continues to this day.  They are able to lead today through their value system.

This class allowed me to elevate my thinking regarding the definition of true Leadership.  I learned that when someone messes up, even if it costs your company $30k, you don’t demote the guy and reduce his pay.  If you’re a true leader, you would pull the guy aside, review what went wrong, determine a path forward, and simply say “I know you’ll do better in the future.”

I was there when we demoted the individual for causing a mistake which cost our company $30k.  The boss knew that I didn’t have the guts/cajones/?? to do the demotion myself, so he sent our business consultant to do the dirty work.  I couldn’t look the demotee in the eyes for a while.  I felt that it was a sign of my weakness as a leader.  I have since learned that it was a sign of weakness on my part – that I didn’t stand up for the demotee and say “there is a better way to do this, one which will build this guy as an employee.  We don’t need to tear him down.”

The goal of demoting the employee was to make our company stronger by removing ‘weak links’.  Perversely, this action actually had the exact opposite effect.  By demoting the employee, we weakened our company while if we had worked with the employee, we would have strengthened our company.  Remember: rewards and punishments work, just not always as intended.

Through this class, I have learned that true Leadership (SuperLeadership / Servant Leadership) takes tremendous guts, more than any other style of leadership.  Put yourself in Lincoln/MLK/Gandhi/[Name your religious leader’s shoes] and imagine the crystal clear vision they must have had in order to stand up to session/dogs, fire hoses/the British Army/[Name your oppressor].

I know that I am principled, I just need to be brave enough to stand up for my convictions.

 

(Photo Credit: http://listverse.com/2011/02/19/top-10-greatest-philosophers-in-history/)

Leaving the Day Job

The Office - Season Header

[Spoiler alert…only if you’re 2+ years behind the times as well]

This past weekend, my wife and I finished the last episode of The Office.  Many of the characters changed over the nine years: people joined Dunder Mifflin, people left Dunder Mifflin, others realized that life is much happier than they expected.  Having worked in an ‘office’, I can almost recognize, person to person, an employee in my office to a character on ‘The Office.’  Yes, I admit, I did shed a few tears during the last two episodes.  The show may have been a comedy, but the writers and actors were able to shine a light on real life.

One of the main characters, Jim Halpert, has a monologue in which he says “I sold paper at this company for twelve years.  My job was to speak to clients, on the phone, about quantities and types of copier paper.  Even if I didn’t love every minute of it, everything I have, I owe to this job.  This stupid, boring, amazing job.”

That quote is perfect for me.  My day job hasn’t been ideal 100% of the time, but I owe everything to this “stupid, boring, amazing” job that I have.  Many people would complain about the job, and I have certainly complained.  However, as I look around my house and reflect on the previous nine years of my life, I realize that I do owe just about everything to the amazing job I’ve held.

I have learned a ton of lessons from my job:

– People generally won’t/can’t/don’t change.  Work with them as they are and everything will be smooth.
– Hard work does actually pay off
– Calculated risk pays off
– You don’t actually have to wear a tie to work
– Always give 110% at work
– If you think you’ve got a great system in place, improve it by 100% or you’re toast
– Client communication is key
– Continue to learn at work; when you’re no longer learning, it’s time to leave
– There’s only one person to blame for your unhappiness at work – you.
– An attic in the summer is about 140degF (Fucking hot – pardon the language)

These lessons are quick to type but have been learned over a nine year period.  Some have been easy to learn (I didn’t have to wear a tie) while others have been difficult and thought-provoking (If you think you’ve got a great system, improve it by 100% or you’re toast).  For me, this has been the best first job I could have asked for.  As I have matured, I have learned what I enjoy doing (running businesses) and what I’m not fond of (crawling through fiberglass in attics in the summer).

Probably the most important lesson I have learned is that everyone is on their own path.  Some people have presented at the State Science Fair, earned Eagle Scout, and completed an engineering degree.  Others have not.  Just because someone has not done those things does not mean that I can (or should) compare myself to them and vice versa.

The path I am walking is entirely different from the path my brother is walking.  We are each learning about ourselves, yet we are arriving at our own conclusions.  Our conclusions are right for our own experience.  We each take these disparate pieces of information we call ‘experiences’, and synthesize this information into a road map for how we should live our lives.  The problem is that we can only look at the map after we’ve walked that piece of ground.  I should not project my life experiences onto my brother.  I therefore should not expect my brother to make the same decisions that I have made.  Rather, I should celebrate his successes and discuss his failures.

We are all faced with a choice.  There are easier paths and harder paths.  Everyone just needs to be able to look back at their life and be happy.  Steve Jobs is quoted: “I have looked in the mirror every morning and asked myself: “If today were the last day of my life, would I want to do what I am about to do today?” And whenever the answer has been “No” for too many days in a row, I know I need to change something.”

That is where I am.  I need to change something.  I have done amazing things.  I expect my day job will continue to do amazing things.  I actually think the company will be better off when I have departed, not because I am holding anyone back, but because the company’s focus is too scattered.  Once I have left, I feel the company will be able to focus on the profitable areas of the company, hopefully producing significant gains for the shareholders.

I am scared and excited for the changes in the future.  Where am I going to be in 12 months?  No idea.  I may still be here; I may be on the west coast; I may be in NYC.  London?  Maybe.  Two years from how?  Not even the foggiest idea.

Like Robert Frost says:

“Two roads diverged in a yellow wood,

And sorry I could not travel both
And be one traveler, long I stood
And looked down one as far as I could

To where it bent in the undergrowth;

Then took the other, as just as fair,
And having perhaps the better claim,
Because it was grassy and wanted wear;
Though as for that the passing there

Had worn them really about the same,

And both that morning equally lay
In leaves no step had trodden black.
Oh, I kept the first for another day!
Yet knowing how way leads on to way,

I doubted if I should ever come back.

I shall be telling this with a sigh
Somewhere ages and ages hence:
Two roads diverged in a wood, and I—
I took the one less traveled by,
And that has made all the difference.”
…I’m more excited than scared….
 ‘

Flip/Life/?? Update

Hey all,  Sorry for the lack of posts for the past month.  It’s been a crazy month since my last post.

Woooahhhh

 

Here’s a quick recap:

May 5, Meet with my friend who just graduated from the local MBA program
May 8, PSU re-opens the application process for Fall 2014; open period closes June 1
May 5-15, Consult with my significant other regarding going back to school in 2015
May 15, I learn about the MBA opening
May 15, (After learning of the opening) consult significant other regarding starting school in 2014
May 20, Sign up for GMATs on May 25
May 20 – May 24, Cram for GMATs
May 25, Take GMATs, Receive 660, 10 pts higher than average entering student’s GMATs (Minor party in my head)
May 29, Submit final application
June 1, Wait to hear about my application
June 1 (afternoon), Feel like I’ve come off a two week bender
June 2, Receive an invitation for an interview on June 6th
June 2-5, Panic realizing that I had sent my last white collared shirt to Goodwill.
June 5, Purchase ‘business’ clothes and ask to borrow Brother-in-Law’s shoes and tie (See below)

Yes, I didn't recognize myself

Yes, I didn’t recognize myself either

June 6, Interview; Told to expect to hear something “Definitely by June 30, maybe within two weeks.  First contact will be by email.”
June 7, Send a ‘Thank-you’ note for the interview, admitting I was nervous.
June  8, Wonder what I said wrong during the interview, remind myself that I could wait until June 30, so continue the nose-to-the-grindstone routine
June 10, Decide to go for a run in my favorite place in PA (Rothrock).  Upon returning to my car, see that I missed a phone call…call was from a University extension number.  I listened to the message.  It was from my interviewer advising that I “check my email as early as possible.”
June 10, 30 minutes past last entry, Check email using Sheetz free internet connection.  I received an invitation to attend school in the fall

-pause-

June 10, 1 minute past previous entry, Hoot and holler (to no one as my car windows are closed).  Decide to splurge and get two milkshakes (one for myself, one for my wife).  Drive home to deliver good news to her.
June 11, Inform day-job that I’ve been accepted; promptly told that my entire division would be shut down
June 12, Informed that my division wouldn’t be shut down but rather put on 12-months notice: Generate significant revenue or else…
June 13, Received an email from my investors to schedule a visit to the site (mild panic); Scheduled for June 21
June 14 – June 20, Try to pack as many hours at the flip as possible
June 21, Investors arrive to view the flip.

This takes us up to the present.  I was incredibly concerned/nervous/scared about the investor visit today.  I have done my best to pack my days with as many hours at the flip as possible.  We started the day with lunch.  We discussed business, my daughter, business, and more business.

I had scheduled a tour of some area homes that may fit a profile for the investors.  After touring five homes, none really stoked the investor’s interests, so we headed to the flip.

To prolong my agony, the investors asked that we look at some additional potential flip-able homes.  I obliged.  We came up with a list of five properties to pursue and see what kind of business we can drum up.  I did my best to prolong this period of time before heading to the flip.

After driving through town for as long as possible, I had to head to the flip.  We’re behind schedule (original schedule had us relisting on May 1), we’re over budget (but not too bad…I think????), and I’m hoping to keep the investors happy.  We showed up at the flip, turned off the car, and headed for the door.  Once inside, I immediately began to point out the flaws in the house.  I figured that I should show what’s wrong with it and let them jump on me.  We walked through the entire home, tested the new bathrooms, discussed paint colors (apparently I have a California sense of style as the entire house isn’t beige) and I laid out the schedule until the house would be back on market.

We discussed my successes (good purchase price, locating good contractors), and my failures (timing to get back on market, insistence to handle as much of the project as I’ve decided to handle (too much), the hiring of my first contractor).  I was expecting to be told that my investors were finished with this experiment, that they had bigger fish to fry and that I was small fry (pun intended).

As I expected, we discussed my failures to quickly turn this flip.  My labor savings have eliminated the return of a quick sale.  My investors did admit that they’re not happy with the length of time the flip has taken.  I was OK with that assessment.

I was unprepared for the next statement from the investors:

“We’re really happy with how you’ve handled this investment and we’re happy that you’ve learned from your mistakes.  We expected mistakes and it seems that you’re aware of the mistakes you’ve made.  We want to move forward with additional investments with you.  We’ve got $X to move forward with you.”

[I had to pick up my jaw from the floor; both for the size of the investment as well as the fact that they didn’t immediately end our agreement because of the timing if the flip.]

Needless to say, it’s been a crazy month: I’m getting ready to leave my day job to head back to school; I’m in the middle of a house flip; my investors aren’t angry, they want to do more work with me; probably the craziest thing is that I feel good about all the changes, I’m not fearful of the future at all.  I’m not even six full months into 2014 and I’ve blown all of my goals out of the water.  Yet I’m OK with that.  I sincerely feel that I’ll come out in a better place now than when I originally set those goals.

This past month has shown me that these next two years will be incredibly crazy, but will be worth it.  I know I can design, frame, wire, plumb, insulate and paint homes.  Even if I fall flat on my face after these next two years, I can still fall back on these hard skills that I have.  Even if the ‘business’ world doesn’t see my abilities, I know I can attract investors, I can deliver on my promises (maybe a few days late..), and I have the drive to see the craziest ideas through to their culmination.  However, I plan to use the next two years to learn the hard ‘business’ skills to allow me to skillfully lead any company in the future.

Warren Buffett, Elon Musk, Ashish Thakkar, Jeff Bezos, Richard Branson…here I come.  Who’s along for the ride?

 

Another quick update – sort of unrelated to REI

I’m still working on my B-school application.  GMAT books no longer decorate my kitchen table.  I’m no longer pondering “if X = y*sin(xy)+tan(z), What is the value of C?”**  It took my brain about two days to fully recover from the GMAT exam that I took on Saturday.  PSU’s average is 645, I scored a 660 (I’m slightly better than average mom!)  I’m now recovered and pounding the keyboard, writing my essays.

Everything is due Friday.  I’m trying to wrap everything up by tomorrow (Thursday), just so that in case I miss something, I’ve got 24 hours to correct any oversight.

The flip is SLOWLY moving forward.  The carpeting is ordered (measurements on June 2), basement is mostly clean, yard has been trimmed back (Thanks Rick!), and I should be able to start painting trim on Friday night (I’ll have a 6-pack of a really good IPA if anyone wants to join me).

Other than that, I fixed a sink drain and hose bib this past weekend.  The home owner had ‘repaired’ the drain with packing tape (!).  The hose bib was a crazy amalgamation of CPVC, galvanized, copper and one black iron coupling.  Yes, it was a mess.  All those various types of pipe were found in a 1′ run of pipe.  I cut that mess out and took the wuss’s way out: I used Shark Bites for my ball valve and female FTP connector.  So much for my nice MAP gas torch.

But it was quick.

In about ten minutes, I had shut off the water, removed the bad pipe, installed the new pipe and turned the water back on.  The expense for the Shark Bite connections are totally worth it.  Had I used typical solder connections, I would have been there for at least thirty minutes.

Back to writing essays…

 

**Not a real question on the GMAT

 

Granite Counter top installation

The house that I’m flipping is located about 20 miles from Penn State.  The town is a former timber baron town and when the timber boom ended in the early 1900’s, the town started a slow ‘drift’ downward.  Homes were purchased as investments but the owners never improved the homes (or even kept up with the maintenance).  As a result, many properties have been run into the ground.

As the housing recovery has picked up steam, the homes in the town of State College (home of Penn State) have continued on a steep upward trajectory.  For example, my wife and I looked to purchase a townhouse in 2005.  Most townhouses then listed for between $100k and $110k.  Townhouses now won’t list for less than $150k; if they do, they need significant amounts of work.  Single family homes don’t list for less than $200k.  The $200k will buy a 2/1 in a busy area of town.

I purchased the house to flip in one of the surrounding towns, Philipsburg.  Philipsburg is becoming a bedroom community for State College.  Homes can still be purchased for sub-$100k, meaning you can own a home and pay $500-$600/month for PITI.  As State College becomes more expensive, many people are looking for less expensive housing options, so they are considering Philipsburg.  At my day job, I am receiving many more phone calls from Philipsburg for construction estimates.  Many of the people calling are Penn State faculty or staff.

There has been a marketplace shift to solid counter tops (granite, quartz, etc).  As such, while Philipsburg doesn’t necessarily lend itself to granite counters, I want to attract a buyer that doesn’t want to spend much each month on housing, but has a nice house.

Solid counters can be expensive, sometimes as much as $40 – $60/sf.  I didn’t want to spend that kind of money on counter tops but wanted the quality so my business partner and I decided to handle the granite fabrication ourselves.  My partner has worked with soapstone in the past, but never granite which is significantly harder.  We figured good technique will yield good results.

I located slabs of granite for about $14/sf.  These slabs were edged on three sides (one side is against the wall) and had a polished top.  Granite is not a light weight material and each slab is about 225lbs or so and measure 26″ x 78″ x 1.25″.

IMG_20140503_113636414

 

To get familiar with granite, we decided the easiest cuts would be straight cuts for the counter top material around the stove/range:

IMG_20140503_112714941

 

We built a temporary work space on two wooden pallets.  There was a space between the pallets for our straight edge guide for the cuts.

After getting the pallets set and the slab on the pallets, I taped the bottom of my circular saw so the metal plate wouldn’t scratch the granite.  We simply used masking tape for this.

My partner then set the a piece of tape on the slab, running approximately where the cut would occur.  We did this to reduce tear out from the granite.  I’m not sure how much this actually helped, but it probably helped a little.

IMG_20140503_115548154_HDR

 

Once the tape was in place, my partner marked the location of the cut.  We then set the guide fence off of the cut line.

 

We set the cut depth on the saw almost as shallow as it would go for the first few cuts.  We wanted to reduce tear out or chipping of the granite itself.  The saw we used is a standard Rigid worm drive saw, which, as my partner pointed out, isn’t grounded.  To keep stone cool and reduce dust, we add a little water.  Water and electricity don’t mix too well.  We didn’t have any problems, but it was something for us to be aware of while we cut.

The slab is 1.25″ thick.  To cut through this, we took about 10 progressively deeper cuts through the stone.

We cut from the finished face of the stone.  We did this to reduce any potential blow out on the face side.  As we finished the second cut of the day, we did experience some blow out of the back side of the stone, which doesn’t matter because no one will ever see that.  The cut edge is a little rough and isn’t rounded over like a factory edge, but all in all, our plan worked.

Here is a shot of the partially finished product:

TV Time and FI

Somewhere on the internet, Einstein is quoted “Compound interest is the most powerful force in the universe.”  Now typically, when we think of compound interest, we think of money.  If we invest $1 today and wait (and wait and wait and wait), we will have many multiples of $1 at some point in the future.  The longer we don’t touch that $1, the more money we will have in the future.

In the business world, a common refrain we hear is “Time is money”.  Usually there is a boss standing over an underling demanding the underling(s) stop goofing off and start working, because someone is losing money because time is being spent/wasted.

Just like 1+1=2 is the same as 2=1+1, we can say that “Money is Time”.  We can then take “Money is Time” and insert this into Einstein’s equation, we see that just like money, time also compounds.  If we spend time now, we will reap the benefits in the future.

I know you’re probably wondering how Einstein and “Time is Money” are in any way related to TV time, I say: damn the torpedoes and read on.  

Sometimes, on a late Friday night, when I’m tired, my hands are covered in paint and all I want is to crawl into bed, I wonder why I put all this time into my real estate business.  Some Saturday mornings, when I’m up at 6am so I can make coffee, go for a run and head to a rental to smash some radiators, I remind myself that I believe that time compounds.  My actions today directly affect my abilities to do things in the future.

Recently, I came across a horrifying statistic: American adults watch almost 1,100 hours of TV per year.  I wanted to verify the statistic, so I went to the Bureau of Labor Statistics (fascinating website if you’re into stats).  Well, on the BLS website, I found 2012’s numbers and I was again horrified.  According to the BLS:

“–

Watching TV was the leisure activity that occupied the most time
    (2.8 hours per day), accounting for about half of leisure time, on
    average, for those age 15 and over. Socializing, such as visiting 
    with friends or attending or hosting social events, was the next most
    common leisure activity, accounting for nearly three-quarters of an
    hour per day. (See table 1.)

 “

bls.com; accessed 4/22/14

Those 2.8 hours per day are not per work day or per weekend day, that’s per day, 7 days a week, 365 days per year (366 every four years).  So in 2012, the average adult watched 1,022 hours of TV.  That’s a part time job that someone spent in front of the TV, every year.  That’s the average American adult.  If we assume an average life span of 76 years and an American ‘adult’ constitutes anyone 16 and older, the average ‘adult’ will watch 7 years of TV in their lifetime.  That’s 7 years watching TV 24 hours per day.

Let’s assume a more reasonable TV marathon in which the adult in question watches 16 hours of TV and sleeps 8 hours.  That person will sit in front of a TV for 10.5 years.

That. is. insane.

Think about the opportunity cost lost because of some flashing lights on a box in your house.  Think about the great books that aren’t read because of the TV.  How about the great artists who we lose because they can’t devote their time to their art because of their TV addiction.

TV was never an important part of my life (luckily I had parents that only allowed us to watch Bill Nye the Science Guy, Marty Stouffer’s Wild America, and The Wonder Years…sometimes the X-Files).  My wife and I had cable for a few years when we were married, but during one of our financial diets, we decided to get rid of cable.

I admit, it took a while (like two or three years) for my desire to watch TV to totally subside.  Every Fall, as the leaves get crackly under foot and the air gets crisp, I still think of the college football I’m missing, but that’s really it.  I don’t miss anything else on TV.  Even then, watching college ball with others is infinitely better than watching by myself (plus I can knock off the #1 and #2 leisure activity at once).

We do still have a TV in the house and subscribe to Netflix, but that’s it.  At this point, we don’t even know how we would have time to watch any TV.  My wife is constantly chasing a toddler around the house, I’m working my day job (~2,100 hrs per year) with an additional 750 to 1,000 hours spent on my real estate investment business.  We literally don’t have any time to sit and watch TV.

I’m going to sound like an old fart here, but I think America is losing it’s edge not because we are lazy, but because we are glued to the boob-tube.  Think of how many new jobs would be created if the average American didn’t sit around watching TV.  I think about my own business.  As I work to get closer to FI, I will be buying more rental properties or flips.  Sure, I will spent my 1,022 hours working on the rehabs, but those 1,022 hours will get me so much closer to FI than sitting in front of TV will.

So tell me, am I an old fart?

Reappearing Act

My very first foray into house flipping was a little tough.  My original contractor decided to remove the entire bathroom before asking me.  Needless to say, I was horrified.  Not-too-soon afterward, the original contractor was fired and a new contractor was hired.

Sometimes I wonder how I manage to get myself into the situations in which I end up.  It helps to have a sense of humor to laugh off these ‘small’ speed bumps.

When I met with my new contractor, I basically shrugged off the missing bathroom, trying to put on an air of control about the entire project.  I did let my new contractor know that I fired the other contractor for not discussing the removal of the bathroom prior to the demolition.  My new contractor has called me to discuss every decision on the project (quite a relief).

I visited the site on Sunday, approximately 3 weeks after the original bathroom disappeared and found the following:

The walls are back in place, the drywall is up, the shower is installed and the plumbing is roughed in for the vanity and toilet.  (The toilet is sitting in my driveway)  The bathroom should be painted in a few days with the vanity and toilet installed, hopefully before April 5, when the investors come to inspect the site.

It’s nice to be working with an entirely competent contractor on this flip.  It has really settled my nerves.

Flip update

Tired on Sunday

Hey everyone.  Sorry I’ve been quite absent this past week, it’s been a LONG week for me.  To start things off, my wife (and daughter) were out of town, assisting my mother-in-law for the week.  Then, my immune system decided to take a vacation.  It got rough enough that I even took a sick day from work (I think I’ve only taken three in 9 years of work).

We were insulating a house at work this week (not a bad week to be sick), but the insulation job was SLOOOOWW.  What should have taken about two days to complete took a little over five days (I say ‘a little over’, because we are going back on Monday).  Rather than be a simple retrofit insulation job where we drill a hole in a wall, insert a 1.25″ tube and fill with insulation, we encountered 1.5″ of stucco over 1.5″ of wood lath.  We had to rent a dry-core drill bit and rent an SD-Max drill.  You may have no clue what I’m talking about, and honestly, neither did I until Monday when we rented the drill and dry-core bit.  The dry-core bit is a drill bit made for going through cement.  The bit is about 18″ long, has about six teeth at the end and a funky spiral pattern on the side.  The bit costs $180 (that’s not a typo).

The drill the bit fits on is a hammer drill.  Picture a mini-jackhammer.  This drill was about 30lbs without the drill bit (another 2lbs or so).  You may say “32lbs??? What, are these construction guys wimps?”  Well, we had to do the drilling while standing on a 16′ extension ladder.  Needless to say, our center of gravity was off to begin with, then to we decided to throw it a further 32lbs out of whack.

No one got hurt, it was just a LONG week at work.

Then I had to manage our house flip.  In an awesome twist of fate, my day job’s insulation job (with the mini-jackhammer) was literally located in the backyard of my house flip.  At lunch, I walked 50′ into the backdoor of my flip to meet with the contractor and answer questions (if any) or simply see what he was up to during the previous day.

On Monday, I saw the following situation:

Yes, a bunch of seemingly random studs, some acrylic shower/tub liners and red/blue PEX pipe.  However, even when I saw this, the contractor kept telling me “April 1, we’ll be finished inside and working on the roof.”  I kept thinking “yeah….right.  You and some special army will finish this work.”

Well, my contractor called in Seal Team 6 to get the work finished.  I’m not sure how he did it, but he did.  These pictures were taken on Sunday:

Somehow the dude pulled out all the stops and got both bathrooms (and the kitchen) to the point of painting by Saturday.

I’m B-L-O-W-N–A-W-A-Y with the effort he put into it.  On Saturday, I again asked him if we were over or under budget.  He conferred with his partner and they both agreed that they are still under budget (not exactly sure how).  We’ll be meeting on Friday to discuss budget and see how over/under we really are.  I’m hoping I’m not swimming naked with the tide going out…

Anyway, last week was long for me…this upcoming week will be long for me.  I’ve got a full week of work and have to get the house painted with my partner (and if there’s time, get the kitchen flooring installed).  Our investors are coming on on Saturday to see the progress, so I need to get a bunch completed by then.

As tired as I am currently (as in: right at this moment), my investors have told me that they are ready to buy the next house to flip (I keep telling them to sell the first one!).  I may be beat right now, but it certainly feels great to have investors who are willing to take on project #2.  (Deep down, it makes me wonder: could I get paid to work the flips (as a day job) as well as maintain ownership of the project (splitting the profits)…the thoughts are in the back of my head…)