Hi everyone. have completed 2 houses so far, ive tried to keep detailed records as to every purchase, every man hour spend doing the work and this is what i have come up with;
* I came up with these numbers by doing 90% of the work myself, no subcontractors. I assumed a pay rate to myself of $30/hour and I typically hire semi skilled help for around $15/hr. I did all the work, from drywall to installing new floors to plumbing and electrical. All work was done with permits......well most of it was ;)
* houses are entry level to next step above entry level. fixed up selling price of 100k to 225k
$20/SF = minimal work; (house could be lived in as is, although severly needs updating)
replace countertops, salvage kitchen cabinates, stainless steel new appliances. light update to bathrooms, paint and new carpet or refinish existing floors. replace most light fixtures and faucets. replace all doors. light electrical and plumbing primarily only to update fixtures. little to no exterior work other than light landscaping.
$26/SF = moderate work; ( lengthy uninhabited house, cant be lived in without some minor work at minimum)
everything above, plus: complete gut and replace kitchen and bathrooms top to bottom, replace one HVAC component such as AC or furnace. light to moderate amount of drywall patching and replacement. light to moderate electrical and plumbing needed and some new runs. new floors throughout house. replace one of the following; roof, windows or siding. light landscaping and a new deck.
$31/SF = heavy work; (typical abandoned/condemned house, heavily vandalized)
everything from both categories above, plus: moderate to heavy drywall replacement throughout the house, mold/water damage remediation possibly needed. some walls may need to be moved to correct layout issues. substantial amount of plumbing and electrical need replaced. all three needed; New roof, siding and windows. moderate to heavy amount of landscaping needed, new deck, possibly extra structures on property need demo'd and removed such as extra gerages, etc.
when i say $$/SF I mean if i look at the MLS and see the house has 2,000 finished square feet I would take my number such as $20/SF and multiply it by the listed 2,000 so my budget for example would be $40,000.
I obviously didnt include every single work item that would be included in these budgets but it gives you an idea of the 3 types of houses im talking about.
my costs above are for actual renovation work only, they do not include your monthly carrying costs such as utilities, taxes, insurance, loan interest, realtor sales fees, closing fees, etc.
do any of you have numbers you use to quickly gauge how much renovation work will cost without having to spend a full day calculating every single thing over and over again for each house? I still do detailed estimates when getting to the point of writing an offer on a house but for screening out the new daily forclosures and auction houses that come up, im trying to get a simple formula for the rehab portion.
I would say minimal work is more like 1-5/sqft depending how frugal you are with labor and materials and assuming you're just patching some drywall, paint spraying the house and replacing the floors. (oh and if you hire yourself at 0/hr)
Jassem, but that seems pretty low even if you were working for free though doesnt it and shouldnt you assume your time is worth something?
I mean cheap carpet alone costs over $1.50/SF installed if ur lucky.
painting typically costs around 1.15/SF (costs spread over the total FSF of a house) assuming your hiring the cheapest guy you can find off craigslist.
cheap laminent in kitchens and bathrooms costs atleast $3.00/SF installed.
I havent been in a house yet that i was looking to flip that didnt need appliances and at minimum new cheap fixtures. even with the cheapest of everything, $1 to $5/SF that would only give you a $2,000 to $10,000 total budget on a 2,000 SF house??
I am not quite sure what you mean by doing most of the work yourself if you are hiring someone to do interior painting and install laminate floors(I would shy away from cheap laminate in both the kitchen and the bathroom btw).
Your example of the light work needed seems a little high though to me from the list of things needed for that one I wouldn't see it costing 40k to do that to a 2000 sq' home.
I am a little confused as to the finishes required as well when you state them being for a home from 100k to 225k. At 100k I would assume lower end appliances and laminate counter tops where at 225k I would assume stainless steel and some sort of stone.
I think you are pretty safe with your numbers overall but might be losing out on some deals assuming light work is so costly.
I have used per/sf calculations like this but be careful about the difference between 1200 sf and 2200 sf. The 2200 is going to be cheaper per sf because big ticket items like the kitchens and baths are generally close to the same size in both homes. The other rooms are generally larger or you have more bedrooms. Spreading the kitchens and bath expenses over greater sq/ft helps reduce per sf cost. You will end up either losing money on a smaller sf home or overbidding and not getting a larger home because you think that the repairs are going to be higher.
I use a spread sheet that mixes fixed and per sf items to come up with a quick repair estimate.
@Chris C. Hi Chris, I'm going through this problem of esti. rehab costs as a novice. Could I take a look at your spreadsheet?
$10/sf will get you new paint on walls and ceiling and new carpet. I use RSMeans for estimating. Pricing will vary per area.
@Austin Mudd I no longer use that spreadsheet. I have moved everything into Podio. I still do the same calculations but with in an app in Podio. I do still have the old spreadsheet and here is a link to it. It is in Google Sheets so hopefully you can view it.
Please let me know if you have any questions.
@Chris C. Appreciate it. I will take a look at it. Looks like this helps you quickly look over a property in only a few minutes to see if it warrants a deeper look. As you've used this, have you found that to be the case? Accurate enough that you can quickly scan deals and when it looks like it might work, it does?
gotta say, in happy this topic might be found useful to some. i have done another major Reno since, 1100 SF 3/1.5. I spent 35k in Reno ($31/sf) this was a boarded up shell of a house, bad shape. Everything was stolen out of it. It did have newer siding an newer roof, everything else is new by my own work. Brick foundation needed major work (quoted $45k by thrasher basements, did it myself for $6k. Plumbing & everything you can think of, I did, all new. 2796 s 9th st, Omaha, ne. Feel free to look it up, help give ya an idea. Good luck to everyone! This country truly is the land of opportunity!!
@Austin Mudd You are in CA, you are x3-5 times expensive.
As you described that is exactly how I use that sheet and it does prove to be very close. Every rehab I do is complete interior paint, all new floor coverings, new counter tops, new appliances, usually new interior doors, some minor repairs are assumed, and all new electrical and plumbing finishes. Anything above that you will have to estimate and add to the sheet in the additional expenses area. I generally do not do very expensive rehabs until this last home which needed all new mechanical. Plumbing, Electric, and HVAC.
I'm curious. Has there ever been an agreed upon standard for $/sf for rehab? I've never considered that as a way to analyze rehab before.
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