Floorplans!

I realized that something we haven't shared are floorplans - one of the most exciting parts of the process!

While you are constrained by certain dimensions and codes, you still have a lot of flexibility when you are doing a gut renovation to decide where you want everything. It's very exciting and empowering to design your home! However, you also have to decide where you want everything, so there is element of stress involved as well. Making decisions isn't always easy!

One thing I'm thankful for is the good taste of my husband. I think the fact that I'm not very picky and generally like his style has made this process a lot easier than it might be for other couples. I generally let him lead the design and offer suggestions where I have a strong opinion.

The first thing we both agreed on was that we wanted an open floor plan. We want everything to have clean lines. We want Modern yet Classic at the same time.

I think the biggest challenges were deciding sizes of bathrooms, bedrooms, and closets.

We were asked by a lot of people why we didn't design a separate apartment downstairs. Remember, this was a two-family property already, but we wanted to convert it into a one-family. "Why not rent out the space?" a lot of people asked.

While there is definitely income potential to at least offset the mortgage payments, this is also our dream home and where we want to raise our family. We do not want to share our backyard or be landlords in our own home. Others probably would have an opposite stance and think about the money involved, and while we are counting every dollar as well, we are happy with our decision to keep this place a one family.

Without further ado, please find our current plans of the house below. Guess which closet is mine? :)

Gut Renovation Inspiration

I can't admit that it was the actual reason for us to take the leap to do a gut renovation, however I will readily admit that we spent (and still spend!) hours and hours, probably years, watching a variety of HGTV and DIY network programs that inspire us to continue with our project in Brooklyn.

While we are inspired, most of these shows also leave us frustrated.

It's no fault of the networks, since we assume they are trying to capture the average audience, but frustration is usually immediate with prices. I understand that NYC is an expensive place to live but there are some issues when we watch the show:

- Home prices are often the amount of our down payment. Yes, this is the why most NYCers don't purchase, but watching someone buy a five thousand square foot luxury home for $300k with no indication of income is frustrating. For us years of working 18+ hours a day allowed us to earn downpayment for a Brooklyn home... $300k though? That would be maybe a two-hour commute from this awesome city and something not in our consideration.

- Permits are at significantly high prices for almost everything in NYC except for cosmetic changes like wall paint color. Want to move your bathroom? Fah-getta-bout-it.

- Unless you are as fortunate as us to buy an entire building (rare) in NYC, then you also have to spend time and money to have the board of the condo/coop building to approve your plans

We are so early on in our construction but remain scared reading other experiences. Please reach out with comments- both if you have questions or went through similar experiences.

Demolition Photos.... Part 1

After closing, the road to demolition was a short one.

Many people don't understand the concept of a gut renovation, even if they think that they do. Even I had to be reminded by my husband several times. Sometimes I would make a comment or ask a question that would make him simply roll his eyes. He somehow understood from the start what it meant. I thought I did; however, it was not until I saw the property after demolition that it really hit me! 

To back up for a minute, I should mention that we did some "demolition" of our own when we first closed. The last "renovation" of this 1910 home had been when drop-down ceilings were all the rage, and we were anxious to gauge the true height of the ceilings in the home. In one evening of inspecting our newly purchased home, we took down a couple rooms' worth of drop-down ceilings and were very pleased to find the pre-war construction high ceilings that we expected. 

In any case, when mentioning the gut renovation to friends and family, and indicating our anxiety concerning the project, we were met with common responses - Couldn't we save some of the wood floors? Couldn't some of the plumbing still be used? Maybe some old materials can be salvaged?

I'll let the following pictures do their own speaking. This was mid-demolition in the middle of January 2013:

To come shortly - the pictures when demolition was recently completed in the first week of February 2013.

Financing and FHA 203k Loans

 Like many others, in order to purchase our home, we needed to finance a portion of it. We had saved very well in our preparation of buying a home, but we were also cognizant of the many expenses ahead of us.

After doing a lot of research, and reading many different experiences, we decided to finance with a 203(k) loan, also known as a “Rehab Loan”. For more information, here is the official website:

http://portal.hud.gov/hudportal/HUD?src=/program_offices/housing/sfh/203k

Basically, with a 203(k), you obtain loan larger than your traditional mortgage, because you are also financing the cost of renovating your home. It’s not as straightforward as your typical mortgage, and there is a lot of paperwork involved. It also isn’t as simple as closing on your home and getting a big fat check for the renovations needed.

The money for the renovations is held in escrow, and there is a detailed list of specific items for which the money is reserved. For example $X,XXX is specifically for floors, or plumbing, or demolition/clean-up, etc. An HUD consultant visits the home and does a thorough documented inspection before closing in order to produce the “Work Write-Up” (WWU) to detail what repairs will take place and at what cost.

Once repairs/renovations are underway, the same HUD consultant returns periodically to do further inspections. When progress is made, you receive payment from the bank from the escrow account through the draw process. A small portion of money is held until the end of the renovation, when they sign off that everything is complete. At that point, the money is either released to you in order to complete payment for the balance of the renovation cost. Any excess (seriously?) would be applied to the principal of the loan.

Seems easy, right? Not quite. In order to close on the loan, a lot of decisions and commitments need to be made. There are things that you wouldn’t have even thought of at this point in the process with a normal mortgage, even if you intended to make renovations to your home. For example, you need an architect and a contractor.

The contractor needs to be officially approved by the bank in order to close on the loan. They need to agree to the WWU and sign it in addition to a number of other forms and releases. They need to prove their licensing, their financial ability to complete the work (remember, funds are not release until progress/completion), and a number of other requirements. You can change your contractor after closing, but to do so is another time consuming and challenging process.

The other tricky requirement is timeline. The bank requires you to complete the renovations in six-months. For a full gut renovation, that is a large task! Additionally, we are in New York City. The Department of Buildings (DOB) here is strict and attentive. You need permits for nearly every type of job, and you have limitations to when work can be done. Since the type of permits we need could take months to be approved, we have already spoken to our consultant about extensions to the six-month requirement. We have been told not to worry about it. Delays that are out of our control are not penalized.

In the end, we were eventually approved and the bank was happy to close. However, approval from the bank is only one part of the closing process…

House Hunting

I have been meaning to start this blog for a while now. Due to time constraints, lack of creativity, and overall just life interference, there was an inevitable delay. However, I'm happy to start posting now. I'll post a few entries at once to catch up to where I was with the blog "offline", but as we go forward, the blog will track our progress with our experience as first-time home-buyers and renovators.

Roughly two years ago, we began a common stage in many people’s lives: we started to look for a home to purchase and call our own. In many parts of the country, this is a rather straightforward ordeal. You visit a handful of homes, you narrow it down, and voila, you move in. For us on the other hand, this was a huge undertaking.

Living in NYC, there was little in our price range that matched exactly what we were looking for. We weren’t even picky: condo, co-op, townhome, brownstone, you name it. All were in our radar. The issue was space. We really wanted space, and maybe even a little bit of green space, and that is a very expensive commodity in this city.

Many outside of the city would be shocked at what people are willing to pay here, but that is a different conversation. For us it was set – we were New Yorkers, and we were going to stay in New York. We had never owned anything (not even a car) and this was an important next step for us.

During the course of two years, possibly one hundred open houses in various neighborhoods of Brooklyn and Manhattan, and many questionable statements made by real estate agents, we realized something: we weren’t going to be happy in new construction, or even someone else’s recent renovations. Not for the price.

We ultimately decided that a “fixer-upper” was the way to go. Why pay the premium for someone else’s new design and detailing when you could design your own? After all, we were in no rush to move in (the perks of a rent-controlled apartment) and could take our time making something truly our own.

However, even finding a fixer-upper was no easy task! Once again, it was amazing what people were willing to pay. Understandably, re-doing many of these properties would reward you with a beautiful home or fine investment, but we simply did not have the cash-flow that many of these places required. Finally the insistent search paid off and we find our house. We did make other offers along the way but this was the one: a two-family configured, 1910-built, modest home in Greenpoint, Brooklyn that we envisioned as our single-family, “high-end” home. It even had a backyard!

Finding the house was just the beginning….