I have literally inherited a kitchen project. Help with priorities?

6 years ago

Sister died of influenza recently. I will be executor/personal rep for her estate. Her 1952 house was under construction: a kitchen bumpout plus long-delayed maintenance. Her loan of necessity exceeded the county's current estimate of the house's estimated market value. My goal is to be true to the executor's mandatory fiduciary responsibility to the heirs but also to maximize the opportunity available to me to create a usable, attractive space from the gutted kitchen and to address additional flaws in the house that my sister was not addressing, especially an unusable main bathroom and dreadful landscaping, sidewalks, and front and back steps. I need $15,000 to $40,000 beyond the $170,000 loan unless I can redefine the scope of the project. If one of the four heirs can buy out the others, the house will not be sold to strangers, tying my hands further by giving me guilt if I don't use proper materials.

Because the work has halted until I get my bonafides, I have time to redesign and rethink. I have decided:

1) to buy scratch & dent stainless steel nice new Whirlpool appliances from a local resource [$1800 for a 3-speed venting hood, a double-oven electric range, a middle of line dishwasher, and a freezer- on-bottom 30" refrig without water dispenser]

2) to buy used lighting fixtures (over sink and in bath)

3) to omit the cabs above the refrig and omit wood housing around the 30-inch refrig I have bought

4) to make the water run and the waste go down the drains in the bathroom but not to address all outdated features, such as the lack of waterproof wall treatment in the tub area. I will leave the 1950s tile on the walls but will add a shower on a stick and will reveal the lack of impermeable walls on the homeowner statement to the new owner.

5) to use family-owned pieces in the house when we stage it, including a small t.v. to mount on wall & a small microwave to indicate the position of the microwave outlet on countertop

6) to omit an egress window in basement that would have allowed advertising the house as apartment-capable

7) to gussy up the front for curb appeal somehow

8) to include a ceiling fan for air movement (no ductwork so no whole-house air conditioning)

9) to omit cost of a closet -- use open-air coat hooks by back door

10) to ratchet down on the wood type (from maple to birch) and on level of quality of the cabinets

11) to omit upper cabs either side of the sink (will make open shelves from the cabinet shelves salvaged from the demolition)

12) to sew jolly curtains or roman shades for the new kitchen windows; to use selected items from my sister's horde of possessions to decorate the house tastefully; to recover the seats of my sister's dining chairs with fabric I found in her basement

13) I hope to make a decision about a sink yet tonight (to take advantage of online prices for Pres. Day discounts; might buy a faucet and soap dispenser also).

14) have ratcheted down to bottom of line quality carpeting for living room and vinyl floor for bath; hubby will buy oak flooring for kitchen from southern Minn. factory and install and finish it himself; he will seat the new toilet and the new vanity in bath but plumber will redo the main water lines to the bathroom; hubby will install lighting fixtures but electrician will do detective work and redo the electrical connections in bath

15) will use $25 new LED faux-can ceiling lights to light the perimeter of the kitchen

More ideas, folks? I need to maximize the fabulosity and yet claw back as much as possible from the kitchen loan to pay for the replacement plumbing lines and facade and such.

--Florantha

Featured Answer

artistsharonva

6 years ago

Florantha (pretty name) :)

Wow, you have been through so much. Sorry for your loss. I imagine It must be a whirlwind of stress. Stay strong. In hard times, I find it difficult to make big decisions. Hopefully some Pros can chime in to help.

If it were me, I would lean on some local Pros to help evaluate the decisions before investing your valuable time & $.

I would pay for an unbias appraisal as is, & if the renovation was completed.

The bank with remodel loan may help you with appraisal & comparing the situations ( watchout for bias, they're in biz of selling loans)

I would interview 2-3 Realtors in your area.(watchout for bias) Be aware of over inflated promises to get a listing.

Limited listing for 3- 6 months will help avoid over pricing which will keep the house on market too long & make potential buyers suspicious.

Realtors have MLS access. Make sure to get the house on MLS. A good Realtor will bring CMA comparables of at least 5-10 homes in the area the past 6 month sales ,pending sales, how long on market, etc. They will give you figures on if sold as is & if renovation completed. Be aware it's easier to sell a newly renovation & get a higher sale price which = higher commission. So, find a Realtor who is open to selling both ways.

I would gather the above info then compare following ROI scenarios.

How much could you get to sell as is & payback the loan to bank now.

Costs to finish current under construction project to be habital will bring in how much $.

Would other reno projects, bring a return

Also calcuate your time into equation & how much you want to put into this.

Time=$

The good news the economy is better. The real estate is a sellers market due to less inventory. It's in your favor.

You may find out selling fast as is will be the better decision. Maybe not.

What matters is not just how much $ from a sale. What matters is how much net is made after reno, expenses, commsisions, taxes, loan payoff,etc.

Comparing the numbers on ROI & time, will help give you the confidence in making the best decision in this situation.

Best Regards & Future Success & Happiness

Comments (6)

formerlyflorantha
Original Author
6 years ago
Artistsharonva, Thanks for ideas. Lots of Catch-22 stuff....If the work had not been so advanced, we would have sold as a tear-down--it's the smallest house in desirable neighborhood. But I cannot sell quick and run. The house is jammed with objects including my parents' house contents, so the cleanout and dispersal will take months and cannot be done by anyone but me and there's a POD in yard that has to be emptied as soon as feasible. Can't have estate sale for a long time. It's Minnesota winter; we cannot leave the construction zone unfinished nor liable to vandalism. I will not stiff the contractor, who has been incredibly patient--long story. My daughter may be able to buy the place if I can keep cost low but she benefits financially if I can sell high. Neighbors are interested in buying.
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artistsharonva
6 years ago
I see. Winter is a challenge. Glad you got an understanding contractor.

Since the reno is advance, I would probably just finish it asap during winter & ask the contractor how to get the most bang for the buck.

Get an unbias appraisal to know how much the house is worth before doing any other expenses.

Present the appraisal proof to neighbor to determine how serious they are about buying it. It would also be good to show daughter, so she can see a numbered value from an outside family Pro.

Start organizing the stuff now, so when weather allows, you'll be ready for the estate sale.

I do better on big projects, breaking the to do list into weekly, monthly, 3 month list, 6 months.

1 step at a time will get to the top of any life mountain.

Remember to take time to nuture yourself during the climb.

The situation is temporary.

It will all work out.
formerlyflorantha thanked artistsharonva
artistsharonva
6 years ago
last modified: 6 years ago
When I was helping my folks sell there land, their neighbor kept saying they were interested,but their offers were way too low. So, I put a FSBO sign on it just to see what would happen. This was 4 year ago (buyers market). Interest dribbled in, but we were patience. Finally, the market got hotter & all of a sudden we were having calls weekly. We sold the land 30K over the neighbor's offer. 15 K over appraisal. My folks were thrilled.

You may want to try a sign in yard to see what happens after appraisal. Who knows, it may be such a good offer you'll be freed from this situation.

You might want to put an email on sign, if your'e not wanting too many calls.

Hope that helps.
formerlyflorantha thanked artistsharonva
formerlyflorantha
Original Author
6 years ago
Nowhere near putting out a sign. Front yard has large dumpster + POD + worker vehicles & family vehicles come and go. Icy incline is dangerous. Storm doors require heavy item(s) to prop open or hold closed. Front door has BEWARE LEAD ABATEMENT sign prominent on it. Someone shoveled back step and broke the glass block in center of step that lights up the well pit below--now a trap to break your leg. Piles of construction materials are in the snow. Now that things are melting, there is dripping from roof onto sidewalk (gutters not yet attached, aargh). I can only bear to be there a few hours before I emotionally implode.
friedajune
6 years ago
last modified: 6 years ago
I am so sorry for your loss. I have been an executor and know what an enormous burden and stress it is. You said "If the work had not been so advanced, we would have sold as a tear-down". I know you won't like what I am going to say, but from what you've described, it would be best as a tear-down. The enormous amount of tasks you've listed will take you years, and it sounds like from what you've described that you won't get the payback for your time, your stress, the toll it takes on your and your family. The financial benefit is unknown, but what is certain is that what you've described will cost a great deal, and you said it's the smallest house, so...

The accounting term "sunk costs" would say that "the work so advanced" cannot be recovered and is further significantly eroded by future fixed costs (property taxes, utilities, mortgage, payments on the loan) and variable costs (all the needed improvements). Consequently, walking away from it via selling as a tear down is advantageous. Again, I am sorry, I am trying to be realistic on your behalf. Clear off the stuff you've mentioned of dumpster, vehicles, construction materials, and either pay for a tear down, or sell it as a tear down. You will be released from all this -- a project that will take years, with uncertain outcome -- and you and your family can move on with your lives.

I have literally inherited a kitchen project. Help with priorities?

artistsharonva

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formerlyflorantha
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I have literally inherited a kitchen project. Help with priorities?

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