Our first new construction development in downtown Columbus, Ohio blocks away from the historic German Village neighborhood.
Project details
Property type: single family home
Lot size: 2,178
Livable square footage: 1800 +/-
Neighborhood: Southern Orchards
Bedrooms: 3
Bathrooms: 2 full, 1 half
Garage: 1-car attached
Expected competition: May 2024
Intentions
We have several objectives for this project that we would like to tackle. First and foremost, unlike South Weyant, we are much more confident in our After Repair Value (ARV) or, in this case, our After Build Value (ABV). For this reason, assuming we can keep our construction costs in check, we should be able to cash out refinance and have little to no money left in the deal once it's all said and done. Alternatively, we might sell this property and reinvest the capital into a project in Virginia Beach as it's becoming increasingly more difficult to manage out-of-state projects.
We are also working with the same general contractor and we have learned a lot about how to best communicate and set expectations. This should help ease some of the challenges we faced at the South Weyant project, especially early on.
The final goal is to use this whole project to learn the ins and outs of the construction process from land acquisition to project completion.
Challenges
We didn't even post this blog until after we secured/purchased the lot. The reason being is that a ton can go wrong during that stage. It's far more complicated to identify land that will be profitable to construct on and get the necessary approvals to get started compared to a traditional rehab project.
The first challenge we ran into is the fact that this lot is very small. At only 2,178 square feet, literally every foot counts when trying to construct a new building. We learned that there are two survey types available to us. Generally, though, they both have the same goal, which is to verify what it is you are purchasing with precision.
Mortgage Location Survey: Less accurate, less expensive, less time-consuming, and typically paid for by the seller.
Boundary Survey: More accurate, more expensive, more time-consuming, and more expensive and usually not paid for by the seller. The boundary survey can take the place of the architecture site plan that must be submitted for the new construction permit, which is an added bonus since we would end up paying for this either way.
Since this was our first new construction project and the lot is so small, we decided to have a boundary survey completed. We went under contract in late January and didn't end up receiving the final survey until the end of April.
We were fortunate that the seller was willing to stay under contract for almost 6 months because after we got the survey, we needed the city to approve a variance to allow us to build on the lot (again, due to its size). The good news for us is that a single-family home existed on the lot many years ago. This also means that the utilities such as water, sewage, electricity, and gas are likely very accessible and should decrease construction costs.
A key lesson we learned for the future is to structure purchase agreements that require the seller to provide a boundary survey and approval from the city to build prior to closing. If you skip this step, you might end up with a lot that isn't buildable or faces significant challenges to do so. It also helps to have a general contractor that has a relationship with the city to streamline any approval processes, such as a variance request.
Architecture plans
The benefit of the long waiting period during the boundary survey and city approval process is that you effectively receive a free loan until closing, providing us with the opportunity to collaborate with our general contractor and architect to develop a plan for the build.
For this project, we examined neighboring properties and designed a two-story, 1,700 square foot single-family home with three bedrooms and two and a half bathrooms. Our projected ABV is estimated to range from $275k to $350k, but this could increase based on the finishes and general market appreciation by the project's conclusion.
In terms of finishes, we have a few ideas in mind for both the interior and exterior.
Exterior: White/black/gray siding and roofing with wood accents and black gutters.
Interior: LVP wood floors, white or gray cabinets, wood accents, and an open floor plan.
Backyard: A simple, open lawn with a wooden fence and oversized pavers to enhance the perceived space.
July 19th 2022
The final architectural plans have been completed and reviewed with the City of Columbus. We are now in the process of submitting our application for a building permit, with construction slated to begin in mid-to-late August.
July 28th 2022
As is often the case, unforeseen delays have arisen. Due to the small size of the lot, we were required to obtain a variance, as previously noted. However, we were unaware that we also needed approval from the Civic League overseeing the area. Although the seller had been in touch with the Civic League, they did not provide us with their contact information. While we don't anticipate any issues with the approval, the next hearing is not until mid-September, and we cannot apply for the building permit until after that time. This delay may impact our construction timeline as we may be breaking ground under less than ideal conditions as the weather starts to turn colder.
The lesson learned from this experience is to avoid lots that require variance approvals, or to ensure that we communicate with the Civic League to avoid such delays. On the upside, this lot was incredibly affordable so the hard work should pay off.
Construction
February 18th 2023
After nearly nine months, we are scheduled to break ground in late February. The excavation subcontractor is preparing the grounds for the masonry blocks to be set, after which the plumbers will connect to the city sewer and water line and install all of the house's below-grade piping before the concrete slab is poured.
After the concrete has cured, the team will commence framing the house, assuming the weather cooperates.
Here's a quick overview of the tentative build schedule:
March
1. Excavation
2. Utility hookup
3. Foundation
4. Framing
April
1. Electrical
2. Plumbing
3. HVAC
4. Roofing
5. Siding
May
1. Insulation
2. Drywall
June
1. Flooring
2. Cabinets
3. Shower Tile & Backsplash
4. Fixtures & Finishes
July
1. Landscaping
2. Punch out / contingency
3. Staging
Stay tuned for our next update where we hope to provide the first pictures of the excavation and foundation.
June 19th 2023
The grading was completed as planned in late February. However, once we connected the property's sewer to the city's infrastructure, we discovered that it needed to be repaired and wouldn't pass inspection. As a result, we had to dig up the adjacent street to make the necessary repairs and then patch the city street. This not only increased our construction costs but also delayed the construction timeline by several weeks.
Nevertheless, we are now back on track. As you can see from the photos, the foundation walls have been constructed and filled. We are scheduled to pour the concrete slab within the next week or so. From here on out we don't foresee any other major obstacles and we should be able to stay on schedule, barring any conflicts with our subcontractors' schedules or material shortages.
Additionally, it's worth noting that the housing market has remained resilient which should help us when it comes times to list the property for sale prior to the school year.
September 26th 2023
No surprise—more delays! We had been going back and forth for months with our builder and their subcontractor, who was supposed to pour the concrete slab. Eventually, we decided to switch to a different subcontractor. After that, we allowed the slab to cure for a week and attempted to start the framing, only to realize that the roof trusses had been manufactured incorrectly.
Fortunately, all of those issues are now behind us. The home is nearly fully framed, and soon we will have it inspected by the city. The one thing in our favor lately has been the great weather in Columbus, with very little rain over the past few weeks.
October 24th 2023
The property is now completely framed, and the roof has been installed. We're in the process of completing all rough plumbing, electric, and HVAC before our final framing inspection. After that point, we will fully encapsulate the house with windows, doors, and siding. This timing is great, as it allows us to focus on the majority of the interior components of the home as we move into the winter months.
December 4th 2023
I've been eagerly awaiting better photos before providing an update, but they have yet to arrive from the general contractor. Therefore, I'm sharing the images I have available, as we've made significant progress. All of the rough electrical, plumbing, and HVAC work is complete. The house has been entirely wrapped in gray vinyl siding and trim. To enhance the house's character, we opted for a shaker style on the roof pitches. However, due to budgetary constraints, we decided against the originally planned wood trim. While this does detract from the house's character somewhat, we're hopeful that a dark blue door and some tasteful landscaping will compensate for this and provide the home with excellent curb appeal.
The team is now working concurrently on both interior and exterior tasks to make up for lost time. Internally, insulation and drywall are being installed alongside the final major inspections. Externally, we're grading the property for proper drainage and preparing for the installation of the backyard fence, concrete sidewalk and driveway, and flower bed.
January 5th 2024
We've made significant progress on the property since our last update, both inside and outside. Now, looking back, It's almost comical to compare our initial design to the final product. But remember, this is an investment property, and sometimes tough choices are necessary to maximize profitability, whether we sell or rent the property. Our original vision, with its black trim windows, solid wood finishes, and stone veneer, would have likely pushed costs beyond what the surrounding market could support, potentially hindering both rental income and resale value.
Interior: All of the drywall, trim, and doors have been hung. We've also selected the granite slabs for the kitchens and all of the bathroom vanities are now on-site and are ready to be installed once the floor is put down. If you references the images below: the green vanity is for the downstairs half bathroom, gray is for the upstairs shared bathroom, and white is for the upstairs primary bathroom (reference the images below). We've got some pretty cool tile for the bathrooms that should pair well with these vanities - more to come on that later.
Exterior: We framed out the concrete forms for the driveway, backyard step-down, and front steps and sidewalk. While the city required us to install and pay for the sidewalks as part of the building permit, this will improve the curb appeal of the property. We also completed the gutter installation around the house, as per the original plans, to ensure proper drainage. Lastly, and not shown in the update, the electric company, AEP, has hooked up power to the building.
Next up, we plan to install the LVP flooring and paint the interior using agreeable gray eggshell paint for the walls, white semi-gloss paint for the trim, and white flat paint for the ceilings.
January 22nd 2024
Though progress has slowed since our last update, the gas and electric utilities have been successfully installed, fulfilling a prerequisite for further work. The major tasks for the next week include painting the interior, installing the bathroom vanities, and setting the kitchen cabinets and granite countertops.
March 29th 2024
As you may have noticed, our updates have been a bit scarce lately. The reason for this is a recent change in general contractors. Unfortunately, our previous contractor demonstrated inconsistencies in communication, slow progress, and work that fell short of our expectations.
Lesson Learned:Â This experience highlighted the importance of thorough vetting before entrusting a project to a contractor. In the future, we'll be sure to:
Never pay in full upfront. We'll establish a payment schedule tied to completed milestones.
Always obtain and verify references. Contacting past clients will provide valuable insights into the contractor's work ethic and quality.
Consider starting with a smaller project first. This can be a great way to assess their responsiveness and workmanship before committing to a larger undertaking.
The good news is, we've found an incredible new general contractor! In the past three weeks, we've made more progress than in the last three months combined. We're aiming to wrap up the project within the next two weeks. During this time, we'll be setting the HVAC unit, installing granite countertops and backsplash, mounting all toilets and vanities, and completing any final touches like house numbers, landscaping, and paint touch-ups.
We'll be sharing the final listing photos in our next update, but for now, we've included a few sneak peeks to give you an idea of our progress.
May 1st 2024
We're thrilled to announce that the [property name] redevelopment project is finally finished and now on the market!
There's more good news: we're actively pursuing tax abatement status for the new owner. This means the lucky buyer will be exempt from property taxes for the next 15 years! The City of Columbus is committed to revitalizing this area, and this tax break reflects that initiative.
While the project is complete, it's also a valuable learning experience. In hindsight, we would have changed general contractors sooner in the process. Additionally, for the bathrooms, we might have opted for a lighter color scheme and a wider variety of tile and hardware selections.
