House Flip with a 100 year Old Furnace Bought 10/30/18 Before the Rehab

You can find my book on Flipping houses here: amzn.to/2QfFWJ5
I bought this house for $207,000 this week from the MLS. I am an agent so I made a 3 percent commission when I bought it. The house was built in 1922 and the furnace looks to be original! It is one of the old coal octopus furnaces that has been converted to gas. The electrical is also very old on the house since it still has fuses.
Here is the after video: • Craftsman House Flip W...
The house is a 2 unit property and should be worth around $315,000 once it is fixed up and we make a few changes. We are looking at $50,000 in repairs after doing the HVAC, electrical, kitchen, baths, paint, flooring, etc. We will also have about $20,000 in other costs which include commissions, financing and carrying costs.
I was having a tough time finding deals when I bought this one. This is my first purchase since 8/6/18. i am usually buying a could a month, but I went 2 and a half months without any purchases! Things have gotten much better with another purchase today and 4 more under contract to buy.
We will have an after video as soon as the work is done on this one.

[@garykidd4468]

Grandpa had the same furnace in his house, back in Virginia, till he passed in 2004. He mostly burned wood in it but had a coal room in the basement, It never got the gas conversion. I'll bet that purple room had a coal bin in it at one time. This will be a good series to watch. Please, if you can give a few updates as you go along. You should get a medal for saving this one to live again. We know you will do it justice. Thanks again for sharing your endeavors with us all. That thing with the motor was a low speed fan to keep the air going up the heat pipes when the burner wasn't on. It would keep drafts from falling into the heater and possibly blowing out the pilot when an outside door was opened. It also promoted better circulation to keep cold air from building up in the basement when the upstairs was already warm enough for the burner to cut off. Cool air would fall thru that return on the left side as the upstairs cooled and would be sent back up to even both floors temp out and so the unit could heat downstairs with only one thermostat controlling it. The fan was likely added when the gas was put in. That was state of the art heating in 1930.

[@investfourmore]

Thank you

[@bethmerryfield7186]

That furnace is indeed, the coolest. A fine piece of machinery hailing to olden times. I like it.

[@Sue7777000]

Yep, we had one of those when I was little, 60 years ago...had the coal shoot/bin area when they delivered coal through the basement window! Ours was black. My dad would chop up furniture, for wood, instead of coal, when we were really desperate. Ahhh, memories!

[@lorrieruff4402]

Oh what a wonderful home!! It is one of the most intresting ones you have done. I have only seen that type of furnace once before in a very old business, and I was super young doing errands with my Grandma Pearl. I got to admit, I'm enthralled with this home. Love the old charm, the built in storage, the butler service , great spot for a coffee maker and other things. I would consider thinking about saving that area, for it is part of the charm of the era. I think half the front part of the home was a dining room. Keep the breakfast nook part for a little table and chairs. I under stand improving the kitchen, but not everything needs to change. In the bathroom with the oddly place window, you may consider just a shower stall. I am so excited about this home.

[@investfourmore]

Thank you Lorrie it is a cool house

[@louvin5671]

That living room is amazing! The floors are awesome. and that furnace belongs in the Smithsonian!! That is a crazy furnace. That downstairs apt can be really cozy! Talk about walking back in history. I love that kind of a house.

[@tommyegirl]

Such a cool old place. Can't wait to see the fix up!

[@cheecheedivine]

I see the potential!! That second unit is going to be a great selling point.

[@elmyra.jackson]

A good looking house! The window in the bathroom is very common in almost every older home where I live. Looking forward to the after!👍

[@juliestam]

I love the Craftsman style houses. This one has the potential to look great with the added bonus of generating rental income. Looking forward to seeing how this house progresses.

[@karenhernke281]

Cool house!! Cant wait to see it when it done. I have never seen a furnace like that. Thanks for sharing!

[@MrsLeeByungHun]

Love the Butlers pantry.

[@CursedSouthwest]

LITERALLY THE BEST FURNACE!!!!

[@Sselena3395]

This house is so unique. Had to search for the right word. Haha. But it should be an interesting rehab! Looking forward to the results.

[@Brianj1529]

That furnace looks awesome. Looking forward to see how this house turns out!

[@bnasty267]

Got a laugh out of that old knife switch in the fuse box. Back in the days when safety just meant not touching something you shouldn't.

[@anthonyballard9051]

I'm looking forward for the completion of this one Mark!... 😃

[@Wyldbutterfly028]

This by far ,is one of the best houses I’ve seen and can’t wait to see what it looks like when you’re finished. Would have loved to seen the built ins without that paint but, was excited to see them. I love older homes. When I was younger I wanted an old colonial but the work required to update it was daunting. Settled on an older cape which we’ve updated. Should have bought the colonial.

[@investfourmore]

Thank you

[@mlcbcards]

Cannot wait to see what you do with that kitchen! I like this house.

[@kylebass4635]

I had a heating oil customer who had one of those that was converted to oil. He used a gas heater on the first and second floor and when it was really cold ran the octopus furnace instead. Worked great and he has no interest in changing it out!

[@investfourmore]

Nice

[@ccsmith2937]

Cool. It has lots of character.👍

[@BIGMASTERJ]

I can’t wait to see the after video on this one. I was just curious is there a project that you wouldn’t take? For example bad foundation or mold.

[@kevinzacarias91]

I guess it all has to do with the buying price.. if its low enough I'm sure you can still turn up a profit

[@investfourmore]

There are some we pass up. Depends on the value versus the repairs

[@kittyrichardson68]

I will love seeing how you fix this one up.

[@huntercynthia1]

That house is solid. Love the architecture and windows on both sides of the fireplace. Weird window in shower tho. Fairy and mushroom room leads to antique octopus! Eek

[@dianaciloci1978]

This house has so much character! Please keep as many original details as you can! Good luck with this project! Thank you for sharing! Would you consider a white vanity and white kitchen cabinets in a traditional style for this house?

[@investfourmore]

Possibly!

[@paulanull8731]

Paint elsewhere but not the kitchen cabinets right? They are wonderful and really good storage which we need now days. And natural wood is great and the higher ceiling cabinets raise the ceiling in appearance. But above all Please don't replace them with those big store plastic cabinets in one row. Paint slightly off white if you must but don't remove.

[@trixier6505]

I would keep it a single-family home, Hate the rabbit warren as a rental. Kitchen nook is really too small, so incorporating it into the kitchen is sensible. Good luck!

[@FrankGutowski-ls8jt]

Very nice property! Open that kitchen to the DR. Make the nook the butler’s pantry. Those kitchen cabinets look 70’s vintage.

[@CantankerousDave]

Reminds me of Ghostbusters: Dr. Raymond Stantz: Everybody can relax, I found the car. Needs some suspension work and shocks. Brakes, brake pads, lining, steering box, transmission, rear-end. Dr. Peter Venkman: How much? Dr. Raymond Stantz: Only $4,800. [Venkman looks shocked] Dr. Raymond Stantz: Also new rings, mufflers, a little wiring.

[@harmonj3]

This was a fun one, I love more traditional houses.

[@ResaleRabbit]

Basement apartment would be tough to make nice enough to rent for a ton. I’d put some of the upstairs cabinets down there and put the rest in the shop out back.

[@investfourmore]

We are close to the college so it would be pretty easy to rent

[@ResaleRabbit]

Mark Ferguson - InvestFourMore oh I’m sure. My point was moreso, it’s not going to rent for a ton, considering the pipes overhead and weird angles on some of the ceilings, so I wouldn’t make it look pretty. Recycle the upstairs cabinets downstairs.

[@StArFuRyZz]

That is a nice little house. That old heater is really neat and I can see shy the HVAC guy would want to keep it as a display piece. If the house is that old it's probably all hardwood under the carpet and refinishing it would look really nice..but cost more than carpet. I can't wait to see how it turns out.

[@investfourmore]

If there is hardwood under the bedroom carpet we will refinish it

[@jdrose1000]

That furnace is cool!

[@vandahuman8522]

In all then houses in South Africa, we always have windows in the bathroom because they give good ventilation.

[@investfourmore]

You see it some here, but usually not right in the shower

[@lewisner]

That pump on top of the furnace is totally Steampunk !

[@johnkrim8377]

lewisner Not a pump , a fan it's hot air!👷🏻

[@mariayelruh]

I also grew up with a furnace like that, except it didn't work well and was replaced in the 1970's!

[@VinylToVideo]

I'm surprised to see the blower motor; that was definitely added later. Yours probably was gravity raised.

[@baldemar2102]

More content please. Longer videos, longer podcast. Great info and channel!!!

[@fastidioushandyman901]

That's an awesome old house. It definitely needs a rewire and a new service entrance and main panel put in. That's so old it's probably knob and tube wiring. I can't remember if you said it in the video but that looks like 60 amp service in the house. You'll need at least 100 amp, but I believe 200 amp is now required if you're getting an inspection done. You should totally do more videos on the renovation process though, it would be cool to see a bunch of photos at least, if you're not too busy lol. One question I had though, when you get work done do you pull permits for things like a new furnace or the electrical and get an inspection? Or do you just have it done and don't ask questions? Anyways great video!

[@investfourmore]

Depends on the house and the work we are doing.

[@johnmattiazzo3900]

What a great house lots of potential

[@KimberFarms]

Love this house!! Never understood the window in the shower/tub thing. There are sooo many like that! What I did in one of my houses after window removal, was to install an exterior transom window high in the tub (for light). On the outside I used faux brick to make it look like a fireplace had been there, then painted it to match. Guess it wasn't bad, I sold it myself in 28 days. But then again if you are gutting it, might make sense to move the plumbing. Can't wait to see how she turns out! Thanks Mark!

[@investfourmore]

Thank you

[@OfftoShambala]

I know, right!?!... we have two houses with windows in the showers, luckily our renters have been careful not to allow them to get all gross, we hang shower curtains in front of them... but, some day we will have to redo the one... hopefully later rather than sooner and the other house we are selling... but, yeah, so annoying... if there was some way to make windows shower friendly, that'd be great, but even then, the expense and the craftsmanship it would probably take to achieve that... the only thing I can think of that would work is to fill in a window with glass block and tile around somehow and I would presume the glass block and the tile would need to be flush on the interior/shower side to prevent water from pooling and the grout work/seals would have to be done well

[@KimberFarms]

@@OfftoShambala Hey hey now it was probably an expensive add on in the day! A window in your tub so you can see what you are doing along with everyone else!! LOL It was never a good idea but went on for a long time...My guesstimation is from the 20's until the early 70's. Gross. Also, glass block is so cool! Cheers!

[@OfftoShambala]

@@KimberFarms glad you think glass block is cool... I have always liked it, regardless of how it fell out of trendiness after the late 80's early 90's

[@KimberFarms]

@@OfftoShambala I think if you have one feature on a home that is really cool, it will be remembered instead of just that yellow house or the "Shannon Way" type property. I live near the beach in NC but I stone stack my landscaping..because its cheap to do and no one else has it! Like glass block, it's really cool and memorable!

[@stevencorwin2313]

The properties are old and expensive but well worthwhile.

[@cindyanderson1696]

Great house! Can’t wait to see what you do with it!!

[@investfourmore]

Thank you

[@DP-jy2ge]

Don't remove that kitchen wall, it would be a mistake. Keep that small space for a breakfast nook. Get your contractor to put in built in benches and then just add a small round table. You have that gorgeous cabinet right there ... perfect for coffee/toast station. This is a great house, with so much well constructed original cabinetry. Jealous!

[@fancybrooks3156]

I love the Craftsman architectural style houses. I don't like what the previous owner(s) did to the porch! Save the doors and the old glass door knobs, but get rid of those old, inefficient windows, please. Make the house as energy efficient as you can. The octopus furnace, while a historic relic that is still working, has to go. Again - energy efficiency for the 21st century. Perhaps you can utilize the unused space in the furnace basement to expand the space in the 2nd unit so that it is at least a 2 bedroom unit with a full sized kitchen and bathroom. I would gut those bathrooms. I look forward to your remodel of this one. Even the little workshop attached to the garage looks nice, but you will probably leave that up to the new owners as to what can be done with the space. They can turn it into a man cave or a she-shed if they want to. The property has great potential - not only as a home, but as an income producer and a place for a woodworking hobbyist to enjoy the craft.

[@investfourmore]

Thank you

[@mauricegeorge4320]

Mark, this thing is going beyond crazy. How on earth this kind of very basic home could selling for 315K....There are tons (I mean tons) of 3000 or even 4000 sq ft 20 year old house in Houston area (at least in middle class neighborhood) only selling for 250K. Even if Colorado's property tax is low, you cannot go crazy like this.

[@investfourmore]

One of the best economies in the country and very expensive land and water

[@brianonweilstreet]

I can’t get over how many of the places in your area have what would be considered non-conforming basement units.

[@lonaanastasopoulos5351]

What a cool looking house!

[@investfourmore]

Thank you

[@margaretdevries8090]

Do you reuse much of what you demolish, doors , cabinets, lights etc., Love the butlers pantry ! Love kitchen cabinets but hate the color ! Love craftsman style ! That heating system is a real antique , glad the man is taking the heater ! The house ? People Over in it recently ? Looks like it hasn’t been touched or cleaned in years ! Must have been gorgeous in its prime !! Are the walls plaster ? Or the usual stuff ?

[@investfourmore]

plaster

[@oxL0VEiSADRUGxo]

Great Craftsman home!

[@michellebenoit7153]

This house!! Love your videos. Love Real Estate...thanks for posting these. You're living my dream. #fearisholdsmeback ;)

[@paulanull8731]

This is such a wonderful example of timeless design and simple ways we lived. Please keep the kitchen cabinets without paint. Cleaned with wood oil and the inside cabinets cleaned or painted would keep the charm of the home IMO. The natural wood fronts are what we see bought now for high end home builds so keep them. I know you'll keep the original doors with glass knobs, the hardwood floors. The vintage to antique built ins are absolutely wonderful. The front porch with a bit of spacing and dividing items improved would be so cool, great entrance. Some times vintage is what people want not all the new plastic stuff. I will say the countertops are in sad shape but it is fairly easy to replace. Please keep the breakfast nook. If it bugs you that the kitchen space is too small place a half wall instead of the full wall removal to the kitchen. That would increase the feeling of space, include whoever is cooking or in the kitchen in conversations with guests and family. I also enjoyed seeing the furnace as that is what I grew up on and woke each morning in the winter to the sound of coal clinkers being removed and new coal shoveled in. Running to stand on the floor heat grate over the furnace was the best Toasty warm in those days. Wish I could own that place after all the hidden tube and knob is replaced or the old silk and paper covered wires are gone, new furnace (I am old enough to appreciate not shovelling coal) and better bathrooms. Sigh. Well I am sure it will go but I wish it wouldn't completely. Lovely place.

[@jlharland01]

I'd be willing to bet those kitchen cabinets are not original to the house. In 1922 they would most likely have been built-in-place, and painted. I suspect that kitchen was "remodeled" at some point in it's history. I live in a 1930's Craftsman style that does have original kitchen cabinets and they are all built-in-place. Although my floorplan is different and my house is smaller, I have the same moulding style, tapered columns on the front porch, and built-in storage as this one. I'm really interested to see what Mark can do for $50-$70k - I need ideas for my house!

[@ThePdchavez3]

Love this house so much! Cool craftsman details! I vote to save historic doors and windows! I missed your acquisition cost and what you plan to spend in the rehab...

[@investfourmore]

Check the description

[@rafaeltorres4728]

I feel for anyone who lived in that basement unit. I am sick just imagining living in it.

[@investfourmore]

Well, everyone needs a place to live

[@rafaeltorres4728]

Mark Ferguson - InvestFourMore Yes, you are right. :’(

[@VinylToVideo]

I don't mind it perse but I hate the exposed pipes and things.

[@TheRealPSKilla502]

@@VinylToVideo Anyone living in that basement would be breathing in plenty of mold spores and asbestos dust

[@VinylToVideo]

@@TheRealPSKilla502 How do you know?

[@Twentytwo22-entertainment]

1:38 Without reading the description told me it was a grav furnace right off the bat.

[@sammyelliott5554]

Do the subcontractors you use aware of the hazards in this house and the liabilities. Test should be run on all wall and trim paint for lead, asbestos on the hvac system and int the kitchen and bath floors. To get that removed from that house by licensed contractors in their respective fields would cost from $50,000.00 to75,000.00 to mitigate . Wow

[@FrancisWong]

Great buy Mark! Reminds me very much of the Craftsman we bought a year ago and fully renovated (although we didn't have the cool furnace!). Was wondering what you make of the current market? Things here in SF Bay Area definitely seem to have slowed down in the past couple of months as list prices have gone up considerably in the past year. I'm now seeing good properties on the market for many weeks if not months, reduced prices, in contract with contingencies and many switching to "transparent pricing" rather than expecting list price +>20%. How does it feel over in Colorado?

[@investfourmore]

Thank you. investfourmore.com/2018/10/01/has-the-housing-market-slowed-down-in-colorado/

[@cecerider4911]

Nice, I just purchase a house very similar. The home was built in 1940 and needs lots of work. My purchase price was $23,000.00 and had to move tenant out. I am looking at a cost to fix around $70,000.00 est.. The area is in Charleston, South Carolina...this will be a rental property.

[@investfourmore]

Nice!

[@OfftoShambala]

make a video! would love to see your project before and after

[@cecerider4911]

@@OfftoShambala : I definitely will.😊

[@OfftoShambala]

@@cecerider4911 goody gum drops!

[@eclpzlvr97]

Wow! Another cool house and that furnace was so fun to see. Lots of work ahead on this property. Thank you for the tour! PS: You graduated HS in 2010 or so, right? 😉😛

[@investfourmore]

right....

[@PatrykFracz]

Lol that furnace is actually scary this house is going to need alot of work I hope you can pull it off your crew is in for a rough one thats for sure

[@kolbis99]

I'm pretty sure anybody who would be looking to buy that house would be terrified of that furnace lol

[@investfourmore]

I know

[@rafaeltorres4728]

I am more terrified of the electrical haha

[@WeddArt11]

We had an old octopus furnace just like this one and although it always worked, having a new efficient one saves us a LOT of money...and space. Seeing this one brought back a lot of memories.

[@StevenBuchanan]

Stephen King said he would prefer you leave that furnace in the house. Everyone else would want it replaced. lol

[@jmjpowerjoule]

This is "REAL" house hunting!! LOL! None of that fake stuff.

[@OfftoShambala]

it would be cool to take out that wall in that nook to make the kitchen bigger, but if not, you could build a bench (with storage inside of course) along under the window or in an L shape and the new home owners could put a bistro table in there... I would love a cozy little nook like that myself... or it could be a computer desk/office area and you could set it up for internet cable connection right there... and then people could use it however they want without being locked into a breakfast nook with a bench, although benches with tables are really trending... but, yeah, a larger kitchen would probably command a higher sale price I presume... whatever you do, I am sure you will be successful and it will look great

[@investfourmore]

THank you

[@L.Spencer]

This is going to be a labor of love. That show is Income Property, not Property Brothers. ;)

[@huntercynthia1]

Property brothers = instant identification. Income Property show = Who?

[@L.Spencer]

@@huntercynthia1 I guess they're more famous, but the other guy is a hunk.

[@dianarauh3648]

I think it has a lot of potential. I’m sure it will work out. Don’t forget to share the after video!

[@hjpapow]

Where's the barking dog? Lol

[@investfourmore]

sleeping

[@zacharygirard8815]

Currently looking to purchase a duplex with one of these octopus furnaces as you called it, and everyone I've talked to is telling me it's a deal breaker unless I can get a credit from seller to replace it - or what I'm thinking is just negotiate the price down and get it replaced myself. I'm looking at the property as a long term hold and rental property - what do you think of these things?? If you weren't flipping this property would you keep it?? Obviously it's lasted 100 years already, but I'm afraid of what would happen if it did go out and the tenants were living in it.

[@drdegutrez8458]

I think it would've been better if they converted that gravity furnace to an electric or heatpump, even though natural gas will probably never run out. I just think it's a safer and cleaner option. but it's also more expensive.

[@robstephens]

I believe that it would be cost prohibitive to replace the furnace due to the almost certainty that it and the ducts are covered with asbestos insulation. It would cost many $$$ to have it abated. Asbestos is fine as long as it is in a non-friable state. I would seal any damaged areas in the jacket covering the insulation and maybe make having a rare furnace a selling point. You could probably relocate the kitchen cabinets downstairs. They would look nice painted white with glass pulls on the doors and drawers to go with the existing glass door knobs. Nice house.

[@investfourmore]

I would love to keep it. I just don't know if it would scare off every buyer

[@OfftoShambala]

while I think he could get this place up to parr for 50,000... this might be one that he goes over budget on

[@robstephens]

@@investfourmore Seems like if you explain to buyers that the old coal furnace is now only serving as a plenum for a modern gas furnace that most would be okay with it remaining. The entire basement area, as a minimum, would have to be tented in order to remove the asbestos. If you do decide to keep the furnace, I would definitely install a belt guard on the blower before listing the house.

[@Susi-Saks]

oh an Authentic *Craftsman* style....

[@irockbmw6s908]

How do you decide whether a house should be a flip or kept and added to rental portfolio?

[@BIGMASTERJ]

Jonathan McGuire I am also curious about that

[@investfourmore]

kzbin.info/www/bejne/pXe5oXZ4fNh6oK8

[@Channel-cm7yc]

Got lots of potential. Nah the gravity furnace should really go. The cost to operate that would be ridiculous. That is actually a fan to help move air. A real nice old house.👍👍

[@robstephens]

Depends on the efficiency of the added-on gas furnace.

[@jdrose1000]

It still has fuses! 😂

[@MattBuysHouse]

Love.it, I can see the 50k rehab, 315k arv? You just bought a .83 deal ..tight margin for error ..and profit.. ( I think a non licensed with less experience would need to get that at 180k (.75 deal)

[@MattBuysHouse]

Seeing a fair amount of break even to upside down flips that they don't want to talk about ..to get the house...it's good for cash flow hold..but.if flipper using opm hard money it's game over

[@Powdermonkey99]

Will you remove the closed in porch on the front of the home?

[@investfourmore]

Not sure yet

[@trixier6505]

I am not a fan of that porch enclosure, either.

[@mph5896]

Looks like an environmental rehab disaster. Lead paint, broken VAT tiles, furnace ducting/water pipes wrapped in asbestos.

[@mph5896]

@Robert whittle The thing is, all of those items WILL be disturbed during that remodel. All of that insulation over the furnace ducting will come out when the new furnace goes in. The insulation on the water piping will come down when new piping goes in and the VAT tile is in pieces and will need to be removed or covered. Its a big expense. Your not going to find some contractor to start dripping it out without all the precautions.

[@mph5896]

@Robert whittle I don't disagree with you, but once you post it on youtube ...

[@chrisj197438]

m ph Hire Hispanics to do the tear out work problem solved

[@FrankGutowski-ls8jt]

Robert whittle My Dad was a welder for 35+ yrs. Worked with asbestos blankets. Died at 99 1/2.

[@FrankGutowski-ls8jt]

m ph Therein lies the profit.

[@luvitluvitbaby]

Haha my name is Mark Ferguson too lol!

[@paulanull8731]

Everybody who wants to own this house raise your hand...me first lol

[@willthetrill4849]

Call me crazy all you want but I would rather keep that house original. I would make it exactly the way it appeared in 1922. No modern object would ever be in that house

[@investfourmore]

A lot of people love to say that, but few actually want to live in it or buy it

[@califdad4]

I think you might be off on the 50K rehab, hope I am wrong

[@CursedSouthwest]

If it works, leave it alone!

[@hiphug1ger769]

Wow and you said 50,000? You should have a price is right giveaway of something for the person who guesses the closest to the flip cost. 79,000 is my guess. Not including carrying cost.

[@investfourmore]

Haha, we have gotten really good at lowering our rehab costs by hiring full-time employees.

[@rdnakx250]

In my town nobody will mess with a project like this. They will just demolish it and build new. I salute your abilities to pull this off. Can you just leave that prehistoric furnace in place and put in an alternate system? That would have to be cut up and hauled out in little pieces.

[@lonaanastasopoulos5351]

What the heck, a window in the shower...weird

[@investfourmore]

Yeah, happens a lot here for some reason

[@lisah126]

When should we expect the after video of this house.

[@investfourmore]

A month or two

[@lucyzulick]

oh my.. dreaming about this house

[@isaaccoane3351]

Invest Four More is a NO! I waste may time watching this crap! Smdh

[@investfourmore]

Really Isaac? What are you looking for?