Flipping Foundations with Heather & Nathan from HGTV Canada’s Hoarder House Flippers

Adrian:

On this special episode of the I Love Winnipeg Real Estate podcast, I'm joined by two guests who are featured on Hoarder House Flippers on HG TV Canada. Despite their constant lighthearted bickering, this brother/sister team is a force to be reckoned with. Both worked taxing jobs, Heather as a chef and Nathan as an auto body painter, before realizing that they could make way more money and have much more fun flipping houses full-time. Heather is the organized taskmaster who makes sure that the flip is done on time and on budget, no matter what it takes. Her baby brother, Nathan, is her right-hand man, happy to offer his opinion, even when it isn't asked for.

Adrian:

Heather is the driving force behind the designs, favoring wood tones and architectural detailing to help draw in prospective buyers. Nathan is the techie of the pair, updating the flips with gadgets for tech-savvy buyers. His Internet connection is always stronger than Heather's. Their team is a true family affair. Mom helps with landscaping. Dad is a plumber, and Heather's husband, Garth, is a general contractor.

Announcer:

Welcome to the I Love Winnipeg Real Estate podcast, your premier resource for buying, owning and investing in Winnipeg's real estate market. And now here's your host, Adrian Schulz, who loves all things real estate, property management and mortgage financing.

Adrian:

In today's episode we're talking about house flipping. Personally, I think it's a scary topic unless you really know what you're doing, and I'm joined today by Heather and Nathan, and they appear in the Hoarder House Flippers series on HG TV Canada. Welcome to the show.

Heather:

Thanks for having us.

Adrian:

Before we get started, Heather, can you tell us a little bit about yourself and this guy named Nathan?

Heather:

Nathan and I are a brother/sister flipping team from Winnipeg, Manitoba. We're middle-aged and we came into this late in life, and it's a career option that we're both extremely glad that we took, and we're having fun with it.

Adrian:

House flipping, as I mentioned before, it can be risky, but given that you know what you're doing, what do you look for when you're flipping a house?

Heather:

First of all, when you say, "You know what you're doing," that's a pretty broad statement and I don't know if that fully covers us at times. Oh, there's definitely times when we're winging things, but we are lucky enough to have a large group of people and support behind us that do know what they're doing, so they have definitely helped us out over the years, so let's just put that out there. We don't know lots and lots of things.

Adrian:

Well, but knowing what you're doing can very much mean surrounding yourself by people who are-

Heather:

Yes.

Adrian:

... experts in their field, right, that team approach.

Adrian:

Nathan, when you're both looking at houses to flip, what do you try to avoid that you know can bring frustration to a project?

Nathan:

I think foundation issues are probably number one for us. Digging around in a basement and you see big giant cracks in the wall or outside you see issues, for me personally, it's a big, "I don't think I want to get into that one too badly." Some stuff we know we can get fixed because we have a good support... people with us, I just don't want to get into that personally. Heather sometimes tries to talk me into it, but I'm like, "No." I'm very... I hate everything and she loves everything and that's usually how it goes.

Adrian:

But you make a good combo then. So you're a little bit risk adverse?

Nathan:

Oh yeah. I'm definitely risk adverse.

Adrian:

My wife and I, we buy and own rental properties and I'm more like your sister. I will take the bigger risk because I think there's a bigger play to be had, but she's the more conservative one, so it's good to have a partner in the real estate game.

Adrian:

Now Heather, in the show, you tackle hoarder houses. Was this your first time, and what's different about a hoarder house versus a non-hoarder house?

Heather:

It wasn't our first time. We have done a couple in the past. What's different is you walk into a house and it's so full that when you make an offer to purchase on the house, you don't necessarily know what you're buying. There's so many surprises to be had. The rooms are so filled with things you don't know if there's cracks in the wall, you don't know what condition the flooring is underneath. The boxes and the items in the house can hide foundation issues, which Nathan doesn't like, and when you're viewing a house you don't go digging through all the people's contents to see what's behind that stuff, so it's a little bit of a guessing game when you're buying a hoarding house.

Adrian:

And did the hoarding house add any complexity to mortgage financing?

Heather:

Nathan and I are lucky enough that we finance the houses that we do ourselves, so we don't deal with mortgage financing.

Adrian:

Okay. Yeah, so you're using your own money so you're not subject, I guess, to the regulations and the policies that-

Heather:

Correct.

Adrian:

... lenders would put on. Okay.

Adrian:

When you're designing and finishing a home, do you have a particular buyer in mind?

Heather:

Well, Nathan and I are going to have different opinions on this.

Adrian:

Let's start with Nathan.

Heather:

Do it.

Nathan:

So Heather... As soon as we walk into the house, regardless of where we're buying it or what kind of house it is, she's already got it mapped out, this is who's buying it, this is what's happening, it's going to be this type of person and she's got it designed in her head and then we end up fighting about it, "Okay Heather, settle down."

Nathan:

"I love it. We got to buy it," and-

Adrian:

Does she use that voice?

Nathan:

Yes, she definitely does, and then be like, "You, we need this house."

Adrian:

And you, Heather, what about you and the designing and finishing of a home?

Heather:

I don't know if it's probably inappropriate split decisions, but I walk in a house and it's like, "Yes," and I can see what I want it to be, and so far over the years that initial vision is what comes out in the end, but you are designing for the area, right. There's certain areas where you know you're going to get a single buyer or you know you're going to get a... this is somebody's going to be second or third home and they're going to have kids and animals and that type of thing, so you have to take into consideration where you are in the community and what you think the majority of buyers are going to be looking for.

Adrian:

In Winnipeg, I think there continues to be a pretty severe shortage of inventory, especially for first-time home buyers and young family home buyers. Do your flipped homes cater to that category of buyer?

Nathan:

I think it really depends on the location. We definitely try to design the house based on where it is. You can't be putting high end finishes in a house that's maybe in the North End or something like that, versus you have to go with to what your clientele is going to be like.

Heather:

And I would also like to add that the price point that Nathan and I do, I would say generally is more towards first-time home buyers. Our average listing price when we are done is between 300 and 400,000, so 400 being on the high end of first time home buyers but a first time home buyer that can walk into a $299,000 home and it be quartz countertops, hardwood floors, fully refinished, that is new roof, new windows, a first time home buyer is getting the home of the magazine, of the dreams, that they want, so-

Adrian:

Yeah.

Heather:

Yeah.

Adrian:

You mentioned that sweet spot of that three to 400,000 and I think that that's a great thing to point out, because that's where the shortage is, and ironically first-time home buyers do have this expectation of what they see in magazines.

Heather:

It's crazy.

Adrian:

Yeah. So how many flips could you technically do in a year?

Heather:

Well, we're both a little lazy-

Adrian:

Okay.

Heather:

... and Nathan and I do all the work on our flips ourself, so-

Adrian:

Wow.

Heather:

... we don't want to do more than... I think we've done four, maybe five in a year, and that's the most that we will do.

Adrian:

Okay.

Nathan:

Three or four is ideal.

Heather:

Yeah.

Adrian:

Okay. Okay. You said you do the work yourselves. I'm curious, and we're not disclosing ages, but who's the older sibling?

Nathan:

Heather's way older, like a hundred years or so.

Heather:

Oh yeah, I'm about a hundred years older than Nathan. I'm older than Nathan.

Adrian:

Okay. Is that why there's this perceived take-charge mentality sometimes?

Heather:

We have different personalities. What's that Nathan?

Nathan:

I said you're bossy.

Heather:

Nathan... I am more of a goal oriented time cruncher type person and Nathan perceives that as I'm wearing the bossy pants in the family, so...

Adrian:

That gets us on the track of what is it like working with family? Nathan, you go first.

Nathan:

For the most part I would say we get along really well. There is definitely times that I want to push her down the stairs and there's definitely times she takes the ladder from the roof and hopes that I fall off, but-

Heather:

True story.

Adrian:

Yeah. Again, pointing out they're brother and sister, so this is a safe environment to have this discussion in. And Heather, you mentioned before we started, and Nathan as well, you both have spouses, so there's that complexity of additional people maybe in the business relationship. Do your spouses play at all, Heather?

Heather:

No. Our spouses, we hire them... Well, Nathan's wife doesn't work for us, but when Garth, my husband, does work for us, it is purely he is a subcontractor. The business is mine and Nathan's alone, and if we hire Garth on jobs, he is just an employee for that job site.

Adrian:

Okay.

Nathan:

Though pretty likes to think he's the boss.

Heather:

Yes, though Garth fully enjoys believing that he is the boss of us at all times, even though he is technically just an employee to us.

Adrian:

So not only is he your husband, he is also your paid employee?

Heather:

Yes. That is... I love it. It works out perfect for me.

Adrian:

So you may have the perfect marriage in the eyes of some.

Heather:

Oh yeah. Okay, you could say that.

Adrian:

Before we wrap up the show, Heather, can you tell our guests where and when that they can watch the upcoming episode of you and Nathan doing a flip.

Heather:

Hoarder House Flippers will air on June 2nd at 7:00 PM on HG TV Canada, and you can also watch it on StackTV.

Adrian:

Nathan, I just want you to know, I feel for you being the younger sibling. I have three kids and the youngest one is getting the teased the most.

Nathan:

No, I tease everybody the most, so we got that one wrapped up pretty good.

Adrian:

Thanks so much for coming on the show today, and good luck with your flipping business.

Heather:

Thanks for having us.

Nathan:

Thank you very much.

Announcer:

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