This is one of those stories where words do not do it justice, you just have to see pictures. Fortunately for you, loyal readers, I took a metric ton of pictures.
We got a call one day from a guy out of Des Moines who was power of attorney for his sister’s financial matters in Northwest Omaha. His sister was going through some mental and physical health problems, and was being moved into an assisted living facility. The townhome that she lived in was in a nice neighborhood. She had had started collecting different things, and over several years it had devolved into full-blown hoarding. The brother had not been in the house for about 2 years, but let us know that it was likely pretty bad. He said that he had no idea what the house was worth, but he was looking at options to sell it as-is and would like an offer from us.
Our trusty Realtor, Angie, ran some comparable sales comparisons, and this was actually a really easy property to comp. It was in a subdivision around 144th and Fort Street which was full of cookie cutter townhomes that all sold for very similar prices and had similar square footage and finishes.
Comps showed that the after repair value of this town home was about $180,000. Brandon sets an appointment for us to go see the property and the brother tells us that we can meet a woman there who is the quasi-caretaker for the house to let us in. She is there in the garage with a mask on when we arrive, removing some valuables and personal items from the home before it sells. A mask is a good idea here, even without a pandemic going on. The garage is packed floor-to-ceiling throughout with boxes, containers, and bags and all kinds of other random things.
We walk into the house through the garage entry door into the basement and are immediately hit with the smell of mold, animal urine and feces. Definitely not as bad as The Cat House, so that’s a good start. The room we walk into reminds me of a The 40 Year Old Virgin where Steve Carrell keeps all of the toys from his childhood unopened in boxes on display at his house. Except, these were all Barbies. Like, hundreds of Barbies still in boxes on shelves, in piles, next to each other on the floor, everywhere you look are Barbies. Barbie magazines, Barbie books, Barbie videos. You name it, if it has the word Barbie in it, it’s probably in this house. Sadly, most of the Barbies will not be included with the sale. 🙁
The basement closet had a sump pump was which had obviously flooded at some point in the past, because there was mold throughout the drywall and doors and floor. According to the brother, the sump had backed up a couple of years ago and they had never bothered to replace the drywall after fixing the pump.
As soon as I had gotten inside the house, I started taking a video with the permission of the caretaker. We do a walk through of the place, and I’m filming the entire thing so that the brother of the owner and any other family members can see the condition of the property without having to set foot in it. Plus, you know, for posterity.
When we move upstairs, it is almost impassible due to the piles and piles of trash and random things across the room. Fortunately, there are a couple of pathways through the trash that we can actually walk on. I am not exaggerating when I say that I don’t think that our feet actually touched carpet at any point during the tour except for on the steps.
While going from room to room, we see tons and tons of unopened food boxes, bags full of other bags, cans and other containers full of unused clothes and collectibles. Probably at least 30 Victoria Secret bags. I could not quite make it through the kitchen.
When we get to the main bathroom, it reminds me of Resident Evil or Silent Hill right before something jumps out at you. It had probably not been cleaned in over 10 years, and the dogs had been using it as a bathroom as well as people.
We couldn’t get into one of the bedrooms because of all of the piles of stuff in front of the door. When we tried to get into the master bathroom, the same thing happened – it was walled off with junk. Generally, seeing all the rooms is pretty important, so we needed to be careful with how much we were going to offer for the house.
Using our Real Estate Investor X-Ray Vision, we looked past all of the junk and piles of trash throughout the house. Surprisingly, the walls, doors, kitchen cabinets and a lot of building materials in the house were actually not in bad shape. After leaving the house, we decided that we were going to offer $75,000 cash for the property with a 2 week closing. After talking with the brother, he felt that offer was low, but he also did not seem very motivated to deal with the whole situation of getting the house trashed out and cleaned up. After watching the video I sent and thinking about it for about 12 hours, the brother called Brandon back and asked if we could come up to $90,000. After some back-and-forth, we ended up settling on a price of $85,000, as-is.
The closing process actually went fairly smoothly and we ended up getting possession of the property a couple weeks later. Brandon conveniently was on vacation during the closing of this property. I planned to go to the Barbie Dream House for a post-closing walkthrough to see how to best handle the situation and get an inventory of the items left behind.
As I am on my way to the house, Brandon calls me from California and says, “Dude, have you made it over to the Barbie house yet?”. I say, “Actually, I’m on my way there now.” He then tells me that I had better wait because it sounds like the former owner went back to the house last weekend to get a few last things. She was evidently not feeling well at the time and ended up testing positive for Covid-19. Wow. That was a close one. Not that there aren’t already thousands of strains of bacteria there already, I suppose.
I end up giving it another week before going back over to the house. After getting there, I had a few things at the request of the brother that I needed to track down: some Christmas dishware, a drawer for an end table and some old silverware. He let us know that other than those things, anything we found is ours. So, I load up my truck with a lockbox, an ozone generator, face masks, two bottles of Lysol, rubber gloves, raincoat, and my grungy shoes and hit the road.
Once I arrive at the house, I psych myself up mentally and suit up, glove up and mask up.
After walking in, I hose everything down with Lysol and do another walk-through. Doorknobs, banisters, and counters all got doused. Then I start looking through things a little more closely. I could tell that the house actually really wasn’t all that damaged other than being super dirty and dusty. The paths between the piles of stuff where the pets had been going were pretty bad, because that is the only place they could walk and relieve themselves.
I spent about three hours going through things and taking out some things that had value – sweating, swearing and slipping on refuse the entire time. Here are some of the interesting/noteworthy things I found:
Ever seen Catch Me If You Can?
So much jewelry!
Huh. I never even knew that Barbie had a sister. Learned something new today.
Lots of thick dust. This did not pass the white (yellow) glove test:
Once I had finished, I called our trusty clean-out guy, Dennis, and let him know we’ve got a real doozy for him. I tell him that I would like him to come take a look and give us a price on a clean-out. So, he comes and checks out the property and lets me know it would cost $3,500 clean it out and pull all the carpets. I hire him on the spot.
4 days later after the clean-out was completed, I debrief Dennis. He says found about 200 or so boxes of unopened cereal, all kinds of food, collectibles, jewelry, unworn clothing with tags still on, and a ton of books. He donated some things that were clean and new, and trashed the rest. He also tells me that we have now given him the 2 worst cleanouts he has ever done in 20+ years. So we have that going for us.
I ask him how would many dumpsters he thought it took, and he estimated about five and a half 40 yard dumpsters. Or about 35 truckloads of his Baby Blue Boxtruck.
When I go back to the property and take a look at the post-cleanout results, I snap a bunch of pictures to show the difference. The property hasn’t been deep cleaned yet and is still really dirty, but we have told a few a few of our investor friends about it who might be interested in a flip in a good area.
The plan originally was to give the property a really deep cleaning and then list it as-is on the MLS as a wholetail deal. One investor that has bought properties from us in the past ended up taking a look and giving us our asking price of $130,000 with a quick closing. Obviously this was a homerun deal.
Surprisingly, after removing all of the trash and debris, the house is really a fairly straightforward cosmetic remodel. We gave the investor who is buying the house enough room so he could either rehab and sell it as a retail flip and make about $20,000, or keep it as a cash flowing rental with some equity in a really good part of town.
We love buying hoarder houses at Red Ladder Property Solutions because they can be really profitable, and we can help people out of some tough situations that they don’t know how to handle. Have you ever seen one in person? Let us know in the comments!
6 thoughts on “#3 – The Barbie Dream House”
Wow. That was a brave buy. Glad it turned out well!
Great monry maker for you!
Yes, that was a good one – we got lucky with not finding anything worse under all of the stuff.
Yooooo that is crazy! Really enjoyed that blog post. Keep em coming!
Thanks Gregory! I have another pretty good one that I’m finishing up. Coming soon!