Real Estate Broker · Durham, NC · Member since 2020 · 49 posts · 42 votes
Hey everyone, I am looking at a 8+ unit multifamily property in the Raleigh/Durham market and I am trying to get a good estimation of what it's going to cost to renovate. The units are 850 - 900 SF.
Does anyone have a average cost per foot to renovate, or is it better to use a price per unit approach? Thanks in advance.
@Graham Storey - If this is your first major renovation and property purchase, then please find a GC or an experienced investor to walk the property with you. We are all victims of "we don't know what we don't know" and there is a huge potential for missed items in a potential renovation.
Big picture, you need to have a level of comfort with the major systems of the property, from the ground up.
- Land/zoning/UDO/flood maps/property drainage
- Sewer
- Foundation/structural
- Measure the property yourself to make sure it is in the ball park of the stated sq'
- Plumbing / Electrical / Mechanical
- Roof
- Cosmetic ... this is usually the only obvious thing and has the fewest expensive surprises.
One of my first big renovation projects I missed a significant electrical detail and I missed that the property was 200sq' smaller than the listed amount on the tax site. Both of those mistakes were painful learning curves. Thankfully, I bought the property at a price where I had the room to make a few mistakes. My total project was budgeted at $8k and ended up being $22k with me doing a significant amount of the work to control the project cost. We won't talk about the ARV difference on the missing 200 sq" ... live/invest and learn.
Best of luck on this deal! I hope that whatever the outcome ends up being, that it's a successful step for you as an investor.
It's hard to say without knowing the specifics. Before providing an estimate, any contractor would physically look at the place to determine what it needs.
It also depends on the quality of materials used, who's doing the work, and how deep you want to go into the renovation.
Are these going to be class A apts, B, C, D, etc...?