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by Benjamin Flower
Los Angeles Business Journal

Self-taught carpenter Paige Hemmis and her husband Russ buy fixer-upper homes, give them a quick facelift and then offer them on a rent-to-own basis. Their company, Rent to Own Investments, distinguishes itself by applying 100 percent of rent money paid toward the purchase of the home, rather than a portion of rent. Hemmis has also found a sideline as one of the carpenters on ABC's "Extreme Makeover: Home Edition." She learned carpentry out of necessity when she and her husband launched their business.

"We had a friend in Australia who had a rent-to-own business. He gave 100 percent of the rent paid by tenants back to them as a down payment on their first home, and we loved the idea.

"About two years ago we started buying rental properties. We had the money to buy them, but not the money to pay someone to fix them up. So I learned carpentry out of necessity.

"I learned how to do electrical, plumbing, drywall and cabinetry. I think it was my husband's way of acquiring tools.

"We buy homes in areas like Lancaster, Palmdale and Bakersfield. You can get a really nice three-bedroom two-bath home for under $200,000. We spend a week or two fixing it up. It usually costs us around $4,000 out of our own pockets.

"We select a house that has been on the market for a while because it makes them easily bargained for. The house usually needs a lot of cleanup in the yard. On the inside we put in new flooring, repair the walls, replace sinks and faucets. Basically it is a lot of surface repair.

"We currently have 14 homes that our tenants will purchase at the end of a one-year or 18-month lease. We bought 14 homes the first year, and we are hoping to buy 28 homes in August of this year. The first 14 included a lot of trial-and-error but now we have a system in place where if we decided to sell the business to someone else, they wouldn't have a problem picking up where we left off.

"We have investors who include family and friends who also help buy the homes. The profit average for us is about $14,000. Our projected profit for this year is $196,000.

"There are a lot of little tricks we use to give 100 percent back to our tenants. We set up a savings account for the rent tenants pay, and at the end of the year they can see how much money they have saved. It really motivates them. Some tenants have put their home on the market right after they purchased it, making a profit.

"We also work with our tenants to improve their credit, so when they buy the house their credit is much better."

View the original press release at Entrepreneur.com.

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