Happy post Thanksgiving. Hope the festive season continues to be...festive, fun, and fulfilling for everyone.
My business partner and I will close on a one bedroom condo next Tuesday. It is in decent shape, and is in move in ready condition. It is in the Lakeview area in Chicago; definitely an "A" location. The kitchen is outdated with old appliances. The bathroom could use a new vanity with tiles that are not easy on the eyes. Everything is working.
We have a limited budget of $6,000 and would like to put it towards upgrading the unit.
Our goal is to increase the ARV. What are your recommendations to best use the $6,000 towards upgrades and improvements?
Thank you, everyone.
a basic ARV is the comparable properties sold around the area. Similar beds, bath, structure and sq ft. If you can add a bedroom within that amount in the basement or something like that would put you in a higher Comp bracket. Or even a half bath would add value. But it's going to be tough with that amount of money to contract out. 6k alone might just cover materials.
@Kean Chew with a 6k budget you will be limited, but you can definitely still add some value. Focus on changing countertops (granite or cheap quartz), painting the kitchen cabinets white or grey, changing the hardware on the kitchen cabinets, and getting some decent used or scratch and dent stainless appliances in the kitchen. In the bathroom, you can lay a floating vinyl plank floor over the old tile with no demo in most cases.
@Kean Chew do you have pictures?
With a limited budget, I’d consider
1. Perception of the unit
2. Lead times on supplies
Also, hopefully you and your partner can DIY :)
When we make decisions on a remodel, we walk through and determine how simply altering the PERCEPTION of a space can eliminate early buyer complaints - especially about
- First Impression (exterior/door/windows/interior entry/colors/flooring)
- Space / flow (limited by budget, but not impossible to improve)
- Kitchen (cabinets/counters/appliances)
…. In that order
With a bigger budget, that would be a longer list, but it’ll take some precision and creativity to maximize $6,000
> If everything looks pretty good - consider a coat of paint and a good staging company!
2. LEAD TIME
Fixers become expensive monsters when the project takes to long.
Doors and cabinets are usually taking extra long to get in these days, so refurbishing what you have for these items might be wise.
Hope that helps :) I love simple projects that just need some basic work!
@Kean Chew - Thanks for the holiday wishes and congrats on your upcoming closing. Are you moving in or planning to rent?
Lakeview is definitely one of the nicer neighborhoods in chicago. $6000k won't go too far but you could probably retile the bathroom or purchase some low-grade stainless steel appliances should be around $2.5k-$3k. Otherwise maybe just save your money until you can tackle a bit more at one time.
If you are living there decide what's highest on your personal priority list and tackle that first.
Not much $$, but I'd say: paint cabinets with a high quality enamel (sprayed if possible). Best countertops you can afford (check the boneyard pile at granite places). Add can lights to kitchen.
@Kean Chew ARV is market dependent, so look at similar properties in your market and find areas your property may be lacking.
With $6k and not knowing anything else about the property I would do: (1) new paint, (2) upgrade kitchen, or (3) redo some flooring with vinyl plank
So everyone will have an opinion and voice on this. Everyone that has commented has said very good points. A point I want to reiterate is the lead times. They're insane right now. We're talking months, not weeks. So what's your plan your time line? Are you trying to flip? BRRRR? STR? If what you're wanting to affect isn't possible due to lead time, what is your Plan B?
Like @Jonathan Klemm said, appliances and cosmetic updates might be the best bang for your buck. Create your budget and stick to it. HOWEVER!!! Word to the wise/proceed with caution, and Jonathan can speak to this way better than I can, with such a tight budget I would not get demo happy and start opening things up in the property that do not need to be fixed. That rabbit hole can be deep and bottomless. Everything ties into something else and a "simple" project becomes so much more in-depth that what both your time and wallet have been budgeted for. If you open a wall up and see its not to code, congratulations now you need to bring it up to code. On the flip side of this coin, if you are going to do something do it right the first time or you will be doing it again. Don't cut corners just to save money in the long run, or be the guy that uses drywall with no waterproofing membrane in the shower.
Again congrats on your closing tomorrow. Develop your plan, stick to it, and execute. Best of luck!
Hey @Kean Chew:
We love Lakeview!
1. Are you renovating to rent or sell?
2. Sharing some pictures here would probably help so we can see what really needs it the most.
Look forward to seeing what you got! :)
@Kean Chew Have you taken a look at what updated units are selling for in that building/area? You should look to see what the spread is and what qualities the top dollar units have that differentiate them from the units that sell cheaply. I think 6k is not going to get you very far past an average bathroom remodel or partial kitchen remodel, so you might want to pad the budget a bit more. Feel free to reach out if you need a sounding board for ideas!