- Tom Brickman, 40, is a real estate investor who works with a lot of fixer-uppers.
- His biggest job was cleaning out the 4-bedroom home of someone with a hoarding disorder.
- He profited $100,000 but will never do it again because of how exhausting and risky the work is.
Value-add investors may fantasize about a deal on a distressed property and rehabbing it from head-to-toe in order to turn a huge profit, but according to Tom Brickman, a real estate investor who rehabbed a home in 2020 that had been in major disorder and disrepair, it’s a massive undertaking and not exactly one for the faint of heart.
“This is not for first-time homebuyers,” Brickman said to Insider, adamantly, about taking on such a project.
Brickman said that when he bought the four-bedroom brick home in Arlington, Texas, the owner owed $140,000 on the property, and it was completely unlivable. In order to buy it, Brickman had asked to borrow $50,000 from his grandparents and then take out an additional personal loan with SoFi because he couldn’t get a conventional mortgage on it after the appraisal on the property.
“We couldn’t even get in the door at first,” Brickman said, who added that there was also a massive hole in the roof that squirrels were crawling through in order to get into the house.
After spending $140,000 to buy the house in May of 2020, Brickman would spend the next several months working on it and making it habitable, which ended up costing him another $80,000. However, after all was said and done, the value of the home rose to almost $425,000.
“My husband and I feel like we earned every penny of that $100,000,” Brickman said.
He added that this was his most financially successful investment over the last 18 years that he’s been buying real estate and renovating homes. However, he also told Insider that he would never do this again for three big reasons.
The process is grueling and you’ll have to do a lot of the work yourself to stay profitable
Brickman stressed that people who do this kind of work should be experienced with rehabbing homes and that they should be prepared to put a ton of sweat equity into it.
The first thing that Brickman did was clear out the property, which he said required 11 dumpsters and a snow shovel in order to remove all of the items from the home.
He said that at first, they started with 20-yard dumpsters and ended up renting out 40-yard dumpsters to finish the job.
“I’ve gotten dumpsters before, but we didn’t even clear the foyer — a little eight-foot space — and that 20-yard dumpster was completely full,” Brickman said.
The 40-yard dumpsters that Brickman was using by the end were so big that he received a complaint from the city, which told him that he could not use ones that size within city limits, and that if he continued to do so that he would be fined.
“It was so draining,” Brickman said, adding that his days clearing out the house would start at 7:30 a.m. and end at 1:00 p.m. “When I would leave at one o’clock, I would go to the gas station to wash up because there was no water or electricity in the house.”
Once the house was emptied, the next step was getting the lights and water back on, which had been turned off since 2015. He also needed to replace all of the ducts in the home because small animals had been running around in them for years.
The next thing that was fixed was the air conditioning, which Brickman said was the second-most expensive item on that house after fixing the roof. However, once the air conditioners were flowing again and the place had electricity and running water, he was able to get workers in there to get started on other tasks.
The next things that needed to be done was the resealing of all the floors, and putting in new Sheetrock. Brickman said that they did this room by room. Additionally, Brickman also had to hire two landscapers to get rid of all of the overgrowth in the yard. After that, he installed cabinets and countertops, and had the home’s sprinkler system fixed.
He said that while the hole in the roof was covered while they were working on the home, replacing the roof was one of the last things they did — and it cost him around $10,000 to replace it.
It’s very emotionally draining — and sometimes dangerous
It’s not just that the work was back-breaking. Brickman also stressed that it’s very emotionally draining to clear out the home of someone with hoarding disorder.
He shared with Insider that he personally knew the person he had bought the house from, and that the person who owned it had lost his wife and another loved one within a short span of time, which is when the hoarding started. By the time he had sold the house to Brickman, he was no longer able to make payments, and he couldn’t live in the home anymore.
“It was like uncovering layer after layer of someone’s life,” Brickman said, who added that even if he hadn’t personally known the person suffering from the disorder, it still would have been very difficult to do.
“You can see someone’s sadness and sickness that you wouldn’t be exposed to if you just bought a regular house,” Brickman said. “I wasn’t prepared for that.”
He stressed that in addition to having experience with rehabbing distressed homes, investors should keep in mind what their threshold is for the emotional aspects of cleaning out a house of this nature.
“You have to be able to take the emotional aspect out of it,” Brickman said.
When home values are high, buying into a huge project may be not financially worth it
One thing that really surprised Brickman after he had bought the house was how much it was wanted by other investors. He said that he even had prospective buyers come to his home and ask him for it, which he said hadn’t happened with any other property he’s ever bought.
“It really freaked us out,” Brickman said, referring to himself and his husband.
Since completing this home and opening up about it online, Brickman said that he’s gotten offers from wholesalers on other distressed properties, but he isn’t interested, especially when the prices are between $180,000 and sometimes over $200,000.
“I’m like, oh my gosh, that’s $80,000 more than what I paid and it looks just as bad,” Brickman said. “You uncover stuff as you’re going, and you don’t know how much is wrong until you actually empty it.”
Brickman said that while he made a lot of money off this property, he knows plenty of investors who tried to take on hoarder homes that couldn’t do it, and ended up losing the property altogether.
“There’s a whole lot that doesn’t get shown when this is glamorized on HGTV,” he said.