Flipping Green Houses

Green House
Flipping properties with a nod to Mother Earth at Second Nature Homes

By Jennifer Garrett

When Darin Harris and Dawn McCluskey spot a ramshackle ranch in a nice neighborhood, they immediately start to see green. But this remodeling duo has more than dollar signs in their eyes. This pair of tree huggers has launched a business so that they can turn a profit while treading lightly on the environment.

Like hordes of other part-time real estate investors, this husband-wife team has bought and rehabbed several houses, usually while living in them as they fixed them up. Each time they made a profit, even when they used contractors for much of the work. More importantly to them, though, is that they made money even when they bypassed standard materials and processes in favor of eco-friendly choices.

That got them thinking. They could use real estate to generate income without clouding their collective conscience. So Harris, a consultant at UW--Madison, and McCluskey, a veterinarian, concocted Second Nature Homes. They would buy rough-around-the-edges houses in neighborhoods with good appreciation potential, renovate the homes and then sell them for a profit -- all without living in a construction site, without giving up their day jobs and without compromising their environmental principles.

"We're sort of green flippers," Harris says, referring to the real estate term for buying, fixing up and selling houses relatively quickly. "We're not doing this just for the money. Your home uses more resources than any other part of your life … so we're out to save resources, including energy, and improve health."

Right now they are rehabbing a three-bedroom ranch in Nakoma. They've replaced the furnace, gutted the bathroom, exposed part of the basement so they could turn it into an additional bedroom, and otherwise upgraded and updated everything. All the while they use low-emission paints, formaldehyde-free insulation and Energy-Star-certified appliances and materials.

Harris says all of Second Nature Homes' projects will meet or exceed requirements for Wisconsin Green Built Home certification, a voluntary program that sets standards for sustainable building practices and energy efficiency.

While Green Built Home has had guidelines for new home construction since 1999, the organization implemented its remodeling program just last year. Nathan Engstrom, program director for Green Built Home, says Second Nature Homes is not only the first Wisconsin company enrolled in the program, but it is also the only remodeling business expressly founded on the principles of green building. "It wasn't an afterthought or an add-on," Engstrom says. "From the very beginning, from the ground up, they have built their business on these concepts."

Harris and McCluskey know that green isn't the only way to go, but they think it's the best one. And they think other homeowners and investors would agree if they knew more about it and had some proof that environmentally friendly renovations could also make money. "We hope to set a standard," Harris says. "We're going to spend a little more money remodeling this house than they average remodeler would, but we will sell it at market rate. It sounds a little too good to be true, but we did a really good job negotiating the price on the front-end."

For the time being, Second Nature Homes will continue as a part-time venture, but McCluskey and Harris plan to keep at it as long as they continue earning a solid return on their investment. "I really like my work, so there are no plans to take this full time," Harris says. "We'll just take it one house at a time and see how it goes."