Real Estate Broker · Scottsdale, AZ · Member since 2018 · 125 posts · 82 votes
I purchased this duplex back last year, which had both units on long term leases. So to this point, I haven't done much to the property. Now one of the tenants has vacated from the 1000 SqFt, 2bed, 2bath unit. The rent was $1275 with all of the original 1980's design. It is located in a great A area, with mostly retirees. I think if I hit this right, I can significantly increase rents and get this property in a place where it will remain marketable for the next decade. But I am aware that I have a tendency to want to go overboard and take the upgrades too far. I'm in this one for the long haul, so I am sure I will be good over time. Going to attempt to chronicle the experience on this post.
Project Scope: (Sure I'm missing something)
Full kitchen remodel (remove a wall, extend cabinets, new appliances)
Rental Property Investor · Minneapolis, MN · Member since 2016 · 214 posts · 132 votes
6y
@Ryan Hoover
Looks nice and very functional. I’d run with it mostly as.
unless the cabinets are falling apart, paint them. Curb appeal absolutely, fireplace yes, bathroom... maybe floors, kitchen revamp- it’s great already so why bother? paint cabinets and upgrade appliancesIf needed, hall closet?-I laugh at the idea of how little will be gained (if you can call a sight line down a hall that) for the amount of work needed and loss of a closet.
Paint seems to have a few years left. Popcorn removal before you paint.
Rental Property Investor · Minneapolis, MN · Member since 2016 · 214 posts · 132 votes
6y
@Ryan Hoover
Looks nice and very functional. I’d run with it mostly as.
unless the cabinets are falling apart, paint them. Curb appeal absolutely, fireplace yes, bathroom... maybe floors, kitchen revamp- it’s great already so why bother? paint cabinets and upgrade appliancesIf needed, hall closet?-I laugh at the idea of how little will be gained (if you can call a sight line down a hall that) for the amount of work needed and loss of a closet.
Paint seems to have a few years left. Popcorn removal before you paint.
Nice property! Love the value add here. How much do you think that will cost per unit? How much do you think you can raise the rents?
I'm trying to keep the budget around $25k-$30k. Shooting for a rent increase of $300 per month. This is currently a B property in an A neighborhood, so I think I have some room to buffer from over-renovating.
Looks nice and very functional. I’d run with it mostly as.
unless the cabinets are falling apart, paint them. Curb appeal absolutely, fireplace yes, bathroom... maybe floors, kitchen revamp- it’s great already so why bother? paint cabinets and upgrade appliancesIf needed, hall closet?-I laugh at the idea of how little will be gained (if you can call a sight line down a hall that) for the amount of work needed and loss of a closet.
Paint seems to have a few years left. Popcorn removal before you paint.
Totally understand that perspective. Yes I could probably mostly leave it and get close to the same amount of rent. In this area though, my property may sit for a while based on what tenants expect. Agreed that opening up the hallway aren't necessarily going to increase rents, but do maybe help with attracting a tenant or maybe even keep a tenant long term by removing some of the functional obsolescence. When it comes to the cabinets, the boxes are in pretty bad shape to just stain in this instance. Plus with replacement, I can hopefully get another 15-20 years out of them.
Everyone has different goals and strategies, I am not solely focused on cash flow or my approach would be different. Appreciation, value-add, and refinancing with cash out are all factors in my long term strategy.
Rental Property Investor · Scottsdale Arizona · Member since 2020 · 43 posts · 15 votes
6y
I am also in the Phoenix markets as well just getting started. Fountain Hills is a very nice area. Looking forward to end result and seeing how much you think you added to the property value wise and how much you got out of the rent as well. Best of luck!
I am also in the Phoenix markets as well just getting started. Fountain Hills is a very nice area. Looking forward to end result and seeing how much you think you added to the property value wise and how much you got out of the rent as well. Best of luck!
Nice! Let me know if you have any questions or want to brainstorm about the Phoenix market. I’ve used this strategy before on condos and single family with great results. I’ll keep the updates coming on the progress.
Rental Property Investor · Minneapolis, MN · Member since 2016 · 214 posts · 132 votes
6y
@Ryan Hoover
Sorry about that. I read it wrong. Thought you were saying you typically overdue it and were looking for insights or call outs on which items wouldn’t be necessary.
I typically do brrrrs myself and enjoy clean new kitchens. I Get pretty annoyed when someone calls painted cabinets newly renovated in a listing. If the boxes suck, no reason to hold off. I’m also getting a little bitter about how little appraisers in my area have valued renovated units vs typical hundred year old untouched places.
What does a typical finished product look like for your area? Have any other posts to link to? Excited to see the finished product, but I have decent appreciation for what you currently have. Much better than anything I’ve started with.
Real Estate Broker · Scottsdale, AZ · Member since 2018 · 125 posts · 82 votes
6y
@Justin V. No worries, part of the undertone was to help save me from myself going overboard. I typically buy in areas that I would live, so I approach the renovation the same way. I try to get it to a point where I would want to live there.
Totally agree with the poor stained cabinets with the dumpy old boxes. I have seen more than my fair share of piss poor flips working as an agent. Also have felt the exact pain you speak of with appraisers. I completely renovated a home in Anthem a couple of years ago and the appraiser gave little value to the additions and comped it to original builds.
I attached a couple pictures of that project, as a reference to what I try to accomplish. In this instance, the cabinets were good enough to stain. Below is also one of my first projects, a condo that got everything new to become a vacation rental.
Real Estate Broker · Scottsdale, AZ · Member since 2018 · 125 posts · 82 votes
6y
Checked in on the remodel today. Significant amount of the demo is completed. There were a lot of low hanging architectural soffets to remove. Also got all of the tile materials picked out.
Real Estate Broker · Scottsdale, AZ · Member since 2018 · 125 posts · 82 votes
6y
Project completed and already rented for $1600! Which is a new high for the area on a 2bed/2bath/1000Sqft Duplex unit. Final pictures turned out amazing! Now I have a feeling that my wife is going to make me utilize the same stone for a project on my home.