Investor · Chicago, IL · Member since 2015 · 21 posts · 12 votes
10y
Will there also be a new roof? I can speak to that as we just installed a new flat roof on a 6 unit building (about 5,200 square feet for our building size), new gutters and skylights. It was about $10,000.00 and I think that was a pretty good price.
Contractor · Columbus ohio · Member since 2015 · 90 posts · 42 votes
10y
If you had more details on what your wanting to do to them and sqare foot...i could get you close...your in illinois so cant believe it would be much different then here in michigan
Investor · Chicago, IL · Member since 2015 · 21 posts · 12 votes
10y
Will there also be a new roof? I can speak to that as we just installed a new flat roof on a 6 unit building (about 5,200 square feet for our building size), new gutters and skylights. It was about $10,000.00 and I think that was a pretty good price.
I would assume that i would like to go about it in a way that wont bite me in the aas later so i would be going the permitted way.
No square footage listed
3 Levels
By plumbing I believe they mean just within the walls. I would assume going out to the city its fine. But you never know.
But I wouldnt be putting up walls or anything like that. Just basically starting from the studs. New plumbing, electric, drywall, roof, flooring, baths/kitchens, fitxtures, appliances, 3 seperate HVAC units, etc.
Its wouldnt be low grade material but it wont be top shelf either. Its going to be mix of mid level contemporary looking that looks kinda pricey but only because its brand new and in style.
Contractor · Romeoville, IL · Member since 2015 · 198 posts · 137 votes
10y
Hi Robert,
The first step in that process is to hire an architect familiar with Chicago building codes and get a print made. You will likely want 4 copies, 2 for the city, one for the job site and one for your office. The blue print will make everything come together for bid purposes and will identify materials to be used.
Second (and to actually answer your question) I would ball park the project between $130-$160k in total just looking at the listing photos and without actually being on site.
It looks like plaster walls which is considerably more expensive to remove and in doing so will create additional challenges that the city may require. For instance, if there is lead based paint on the walls & wood work in addition to the asbestos you referred to, there will be added cost to remediate by a licensed environmental company.
There will also have to be time added to the job to accommodate all the inspections, city dump fees to get rid of the toxic material with a manifest paperwork trail ect. This would obviously add to your holding costs.
Hope that helps some, you may already know most of this but thought I would offer my two cents :)
Hartsdale, NY · Member since 2015 · 874 posts · 218 votes
10y
Sounds like a very expensive job to me
we just did a duplex town house style with no roof work.
Lots of interior plumbing that we did ourselves (frozen burst pipes). 2 Kitchens, 2 baths, some electrical, Rugs Garage partions, work and it cost approx $40,000.
I would live in one of the 2 bedrooms units the other would rent from 1200-1400 and the 1 bed would rent from 900-1100....although im not 100% confident in my market rent analysis skills.
Contractor · Romeoville, IL · Member since 2015 · 198 posts · 137 votes
10y
Once you get going and bring the house up to code, it can have a sobering sticker shock. Chicago inspectors expect that the process set forth is followed to a "T" and that there is a clear understanding of code. If the house is to be done from head to toe under permit and within code, then $45k per floor is spot on if you want to actually get the work done by licensed trades familiar with Chicago codes and expectations. Believe me, the value of a house on the north side repaired in this manner will see a huge upswing.
Real Estate Broker · Chicago, IL · Member since 2014 · 2k+ posts · 1k+ votes
10y
I'd ball park $100K (this takes into account contingencies) This past week we got a few multi families under contract similar to yours. One up north, the other south. Finishes will be different so we targeted $80K for the south property, $100K up North. Full disclosure: We establish a target number to make either our cash flow or flip target 1st, then see if we can fit within that target.
Investor · Madison, WI · Member since 2015 · 128 posts · 33 votes
10y
Thanks everybody for the input. I figured somewhere between $100k-$120k
@Crystal Smith I agree with your last sentence that the strategy should be to establish a certain number and work towards attaining that. I plan to live in the property for a minimum of 1 year and possibly more depending if I love the place but from the numbers i ran, I should be able to have the other 2 units cover the payents. But then again, ive never had to cross this bridge and this is all speculation. Would you mind sharing how you determine the number as far as how much a property should cash flow?
Hartsdale, NY · Member since 2015 · 874 posts · 218 votes
10y
$259,000 cost plus $100,000 renovqtion =359,000 plus closingg costs
Rents =
1,200
1,200
1,000
Total rents = $3,400
So that would meet the 1% rule (based on $359,000 cost )
You would have to add closing costs to the price of the house.
You would have to add the renovation holding costs also. How many months of expenses will you incur while renovating the triplex??
If the actual renovation costs goes up From the projected $100,000 you are no longer in the 1% range.
If your own allotted rent of $1,200 (for your on apartment) is more then you are paying now you should reduce your rent projected figure to meet you present rent. If you are paying only $1,000 rent currenty then you should reduce your rent income $200.00. If you are paying more rent now or $1,300 you can add $100 to your income.
This is based on your figures:
("I would live in one of the 2 bedrooms units the other would rent from 1200-1400 and the 1 bed would rent from 900-1100....although i'm not 100% confident in my market rent analysis skills.")
How much are comprable apartments in your area renting for?
This looks very tight to me???
Have some one help you run all your numbers with different rent scenarios??
@Crystal Smith Would you mind sharing how you determine the number as far as how much a property should cash flow?
This is a great question but also a tough one as our criteria for what's a good cash flow varies. Our strategy has always been to purchase distressed, improve, cash flow, then refinance, pulling all or as much of our money out of the property. After all improvements are made our target based on the new appraised value is to have at least 30% equity in a property. With respect to the cash flow number itself- If the property is in a location where we expect little to no appreciation we'll shoot for a Annual ROI of >10%. Just recently sold a property where our annual ROI was ~30%. If the property is in a more stable area we may accept a return of <10%. We'll accept the lower return because there may be an appreciation play. We'll never however bet on appreciation & have a negative cash flow property.
Investor · Chicago, IL · Member since 2016 · 160 posts · 41 votes
9y
@Robert Obniski did you end up purchasing the 3 unit property at 2439-N-Avers-Ave? I see that the property was sold in Jan 2017. I am looking at a similar frame 2 unit building for me to live in one and rent out other and was wondering if you could share your rehab experience if you did purchase it. My property also needs gut rehab.
Contractor · Atlanta, GA · Member since 2015 · 236 posts · 91 votes
9y
I am not sure about pricing in your area, but with the type of rehab you are talking I would expect in Atlanta about $30-$40k/sqft for interior gut rehab. Then add on probably another $6k for roof and gutters and another $15k for new hvac systems and
Ducts for all three units. So, my cost for subbing everything out would be probably somewhere $140k. Now, with that being said, with hiring a gc they would want to charge at least another $15k on top of that.
Hi Robert, Did you finish your project? Did you like the contractor you worked with? I am in the very early stage of a similar project and looking for contractor's recommendations.