00:02.48

wongga

Hello investors this is Garret Wong your host of the investing to win podcast today I thought I would give you guys a little bit of an update on our buttercup project if ah for those of you who've been following along on social media or even listen to an earlier podcast episode buttercup. Is a legal secondary suite conversion project I'm not going to go into the first update obviously because this is a second update but I thought you know, um, been doing a lot of different guests on the show and I thought maybe it's time to just ah, give an update. Um, because there there was a lot of feedback and interest on it. So what I will say is um where I had left the first update um was that we were doing and waiting for our development permit now if you remember there's 2 parts. To the legal aspect of um, getting a secondary suite conversion approved The first thing is getting your development permit and the second thing is getting your actual building permit. So we submitted our development permit and and I made some mistakes. I'm not too ashamed to say that this is my first time even though I have extensive experience in doing lots of renovations and lots of projects and even building permits but never a secondary suite.

01:28.83

wongga

So I had gone onto the website I you know there's a list of 6 or 7 things that you need to submit like your site plan and your square footage calculation a whole plethora of things and I had submitted everything and. After about 3 three and a half four weeks of submitting that and keep in mind we did we submitted this before possession because we wanted to get ahead of the game. So 3 to 4 weeks come by and go by and now I get an email saying well you're missing the main floor site. Or the main floor plans and the main floor floor plans are necessary because they need to see the square footage to be able to calculate the overall square footage of both your secondary suite and your existing living areas. To be able to apply that square footage calculation and I had already submitted it and I thought it was fine I happened to be on vacation. Um up north fishing when I got that email so as soon as I got back and I admit I was rushing I sent them an email just saying. I already sent you the main floor floor plans. What what is wrong here now. The thing that's frustrating for me is they say on the city. Um permit portal that it takes a good 2 to three weeks for a permit to be processed with.

03:00.50

wongga

I've found however is it takes 2 to three weeks on average for a communication to come back. So even though I said and asked a question. What's wrong with my my floor plan. It took three weeks for them to respond to me and say well. You need this this and this for your floor plan I'm like okay fine. So then I submit those floor plans again and I mean I looked at every single thing that they had there and it seemed fine. So I made a little bit of an adjustment to some of the labeling sent it back in didn't hear anything for three weeks Three weeks later it's rejected again. So while that doesn't seem to be that big of a deal think about waiting three weeks for each piece of feedback this happened 3 times 3 times 3 by the my last memory is nine weeks so now we're two months behind because I made a mistake so you know I want to talk about the power of networking the power of a coffee conversation I'm busy I had someone in the um in the. I guess call it our real estate community locally here in 1 of our investment clubs reach out to me and say hey saw on social media would love to you know I you know go for coffee and I just did ah a secondary sweete conversion I'll tell you everything that I learned and all the mistakes and I kind of put that off for a couple of weeks because I was busy.

04:31.60

wongga

And I finally said you know what after this last thing I'm just going to go um, did it on a Sunday morning and wow what life changinging information because he came and we had coffee and he showed me his floor plans and just speaking about. He was just like okay well what does your drafting person say and here's the thing I was my own drafting person. Not to say that there's anything wrong with that and the reason I did my own drafting at the very beginning for the initial floor plan. This is the the ah secondary suite itself is because of timing. I didn't think and realistically I had a few days to submit this before possession to have a drafting person come in. Obviously we had only had the 2 visits prepossession that were built into our sales contract as conditions and I had burnt up both of those already. Or 1 of them already with um contractor visits. So the second one was like in the next day so I went to home depot I but bought a really good bluetooth laser measuring tool I did all my site measurements and then I learned autocad myself I'm good with computers I'm a nerd. So I mean make a mistake this was. Kind of fun for me and it was overall a good experience and very beneficial because what ended up happening is the layout of this basement had what you would naturally think okay, here's there was already a door that led into the basement on bathroom on the left. Maybe that you know kitchen on the right were the.

06:06.34

wongga

There was a wet bar but there was a floor drain right there as soon as you walk in and myself and my kitchen guy and everybody that we're walking through there. All the contractors were just kind of talking about where to place these rooms according to where the entrance of this. Was already. There. So the benefit of doing my own Autocad was I started thinking outside the box and saying okay this doesn't work there I don't want a floor drain even if I put a cover on it as soon as I walk into this brand new unit. What can I do? That's different. And because I had these plans I was able to go and slide things around. Okay I'm going to move a closet here slide this wall over and it's giving me my overall square footage so that those plans that I submitted were 100 % correct even doing the hashed marks for you know there's certain. Ah, specifics for sound um sound barrier proofing sound Stc sound transmission class and smoke tight barriers. So you have to label those properly I did that what I didn't do however was I had an existing main floor floor plan. That was a product of um, us just going through and doing a virtual tour which was you know it looked different than the the downstairs floor plans that I had submitted and I think that was part of the problem because the city is used to seeing.

07:38.89

wongga

Professional drafting plans in a certain way with different keys and maps and different um materials and the way they write things and I didn't have that mine was a completely good dimensional floor plan. It was accurate. It was out of an Autocad program. But it wasn't quite the same. So what came out of this coffee conversation was you know why didn't you use a drafting person and what do what do they say about this main floor and I'm like well I didn't use 1 and the light bulb went off because the reason I didn't use one was because of that timing part. There's no reason I couldn't get a drafting person to come in now. So that was the big takeaway I always say there's always going to be 1 takeaway out of every conference meeting doesn't matter how insignificant or how much you don't want to go there or even a networking event. You're going to get something from it and that was my big takeaway and so. He actually recommended to me his drafting person called him up. He came out two days later did his field measurements 2 three days after that I had complete plans that I have now submitted to the city. Um. And I'm 100% confident that they're going to go through because this guy actually has like 10 years experience in only mainly specializing in secondary suite conversions and drafting plants. So he knew the calculations the square footage calculations. He knew what they needed to see and I have.

09:07.34

wongga

Almost 100% confidence that it's going to go through and when I say going to go through because it's been three weeks I'm expecting those plans to be approved any day. Get my development permit and then we can finally get our building permit going and the project even though it's you know, two months behind that's fine. So I'll give you ah so that's my biggest takeaway use a professional drafting person. Um to do your your plans for your secondary suite conversion. Okay, so now now onto the update portion because the building hasn't just been sitting there the whole time if you recall um before. Possession I had the roofing crew go through and I had the window crew go through take the window measurements to get those into production and I wanted the roofing crew to go through and give me an estimate so I could book that because we were talking about late September early october already I wanted to make sure that we were changing this roof. Before the snow ah was going to you know fly because you know we don't want to have to be painting on the inside and then lo and behold. There's going to be some kind of ice damming or any kind of other problem come spring. So the roof was done um. And I I have to give a shout out you know to above all roofing and exteriors that was a company I used. We used them with our management company. So there's no surprises there but you know they they came in on time said they were going to be there a certain time they did they cleaned up properly I went and.

10:42.00

wongga

Recorded some some clips for social media but they also did before and after pictures which was really helpful when I submitted my progresss ah payment request to my my financial company and my lawyers so that was just super smooth. Um, so yeah, on time. On budget. No extras. So really, really pleasant experience. So ah, tell you a little bit of a story now because this is just the you know, unintended consequences so in a perfect world. We are going to be demoing this entire basement. Including the 40 year old furnace the old gas hot water tank and both of those items the furnace and the hot water tank um are actually going to be located into a new call it a mechanical room in another part of the basement. Because ah, where they're located right now which is close to the foundation wall. That's exactly where I want my new entrance to be for the secondary suite. So just thinking outside the box a little bit and being creative I thought well since it's an old. Furnace. That's not higheffi and it's using the chimney. So now you've got a gas line. You've got the chimney the metal you know, exhaust gas going up there and the the hot water tank which was also about ten or twelve years old I thought we're going to be changing them anyways, let's move them might cost a little bit extra but not compared to having a perfect layout.

12:10.11

wongga

So that was the plan step 1 obviously after we get our our permits demolish everything step number 2 frame everything step number 3 put in the new hvac systems in the hrv so I've been going to the property. 2 3 times a week to check on it and also do a little bit more work and meeting some other contractors and about a week and a half ago I go in and you know it's it's cold here, but not that cold. It's about I don't know ° °C outside I go inside the house. And the furnace has been running and it's like ° in the house. Okay, °f. Yeah, so I'm like okay I know it was on three days ago I go down into the basement I do all the things that I know to do as a property manager i. Check the furnace switch I check the breaker I check the pilot light. Everything appears to be okay for me. So of course the next thing then I call um hvc technician again through our property management company. They're there within one or two hours and then the technician gives me the bad news. The gas valve is gone. A gas valve is 7 to $800 so now we can't demolish. We're not where we need to be because we don't have our permits yet. So I can't exactly move this furnace. So what do we do do I pay $800 to fix a furnace.

13:45.37

wongga

That might be yanked out and basically chucked into the garbage in 2 three weeks I didn't want to do it so the alternative of course is putting in a furnace now. The new furnace into an imaginary place where there's no walls yet. And hoping that then we can somehow demolish around it and not damage. It not get too much dust into it I literally had no choice so I spoke to my hvc company. We came up with a plan and yeah, they they came you know 2 3 days later. We put some temporary heat in. And they started making preparations and there came yet another hiccup so where we had where the drafting person and myself had chosen to have this furnace was located. Maybe I don't know call it ten feet along the main beam where the softet and the planmo were going to be for the. Cold air return in the in the yeah heat venting and normally again, everything would be a blank slate all of the walls would be demoed well would you know it I happen to be there on the day that they are installing this furnace and I measure it out I draw a blue. Tape line on the floor where this wall is supposed to be and where the furnace was going to go. It's exactly where the existing wall is for this furnace room for the old furnace room so they can't install it but I have a little bit of time and I have literally no tools. So I borrow.

15:19.76

wongga

No word of a lie I borrow a screwdriver and a small little pry bar. That's maybe twelve inches long and I did what I needed to do I didn't have time to call a contractor the hvc guys basically went to go get a piece of equipment. They were coming back within the hour I started demolishing. With a screwdriver and a small pry bar. It took the paneling off I took the insulation out got everything all exposed and then obviously there was some electrical in there. We had to work through that. But at the end of the day we were able to get that wall out of there. And they were able to install the furnace and now it's running and now the property is properly protected so that is where we're at um, I'm expecting again to have the development permit any day building permits ready to go and be submitted and then we can start our demo get the windows installed. Protect the furnace. But again, it's exactly where it needs to be. We just have to construct that wall now around it and then hopefully no more delays so I will be doing a few more of these little updates because I have received a lot of good feedback. People are finding it really interesting this journey that I'm taking with the secondary suite conversion and make no mistake this is education for me as well. Um, to me there is nothing better than this plan that I'm doing in these in this environment of high interest rates for me to be able to.

16:49.40

wongga

Take a property convert it into a secondary suite get at least 1000 to $ 1200 of extra cash flow because I'm essentially turning it into a duplex refi and now the building is worth more as a duplex. Not a single-family home. And now I get my cake and eat it too even in a high interest rate environment I'm still going to cash flow not as much as a traditional duplex with your 3 to 4% interest rates but certainly it future-proofs me and so the process that I'm developing right now. It's fine I don't mind the delays. Because I'm documenting everything and I'm going to turn it into a rinse and repeat type of process. So then once this project is done. We're just going to be that's all we're going to be looking for is secondary suite potentials and then we can crank out you know at least 4 or 5 of these a year. So. That's it. Another short solo episode next week I'm actually going to be having a guest on to talk about how to save for your first. Ah sorry I'm going to mess up the title here. How to save a down payment for your first rental property and I think that is going to gain a lot of interest. So until next week this is your host Garrett Wong signing out again on your investing to win podcast have a good week.