$12,000 tenant turnover

Investor · NV and CA · Member since 2016 · 375 posts · 227 votes

I bought a 4-plex about two months ago and one of the tenants just left. The tenant had been living there for 9 years, so there is a significant amount of fixing up to do. It's only a 2 bed, 1 bath. I've been quoted $12,000 for this, but I'm interested in other quotes. Can anyone recommend a reliable contractor?

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Jay HinrichsBusiness Member

Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes

@Ryan Fox what you describe is paint and carpet and general cleaning.. with new floors through out and a stove

5 to 6k..

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Hadar OrkibiPro Member
Rental Property Investor · USA / NZ · Member since 2016 · 1k+ posts · 812 votes
7y
Who is managing the property for you?
What type of 2 bed is it? Garden or Town House style?
What’s the sqf?
What is included in the scope of work??!
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Ryan Fox
OP
Investor · NV and CA · Member since 2016 · 375 posts · 227 votes
7y
@Hadar Orkibi - PM is Plaid Management. There was a clerical error on the estimate they gave me which they admitted to, so it should be about $11,800
Garden or Townhouse style - garden style. This is a ground-level unit. All 4 units are attached, one on top of the other on each side.
Square ft: 850
Scope of work:
Entry Way
Paint walls, ceiling, and trim
Fix doors to laundry closet
Install LVT
Install new front door locks rekeyable
Kitchen
Recaulk countertop
Paint walls, ceiling, and trim
Fix back door light
Install new light fixture
Install new outlet and covers white
Install new kitchen faucet
Remove carpet
Install LVT
Install new stove
Family room
Paint walls, ceiling, and trim
Remove carpet
Install LVT
Bathroom
Remove flooring
Install LVT
Recaulk vanity and tub
Install new faucet
Install new toilet
Fix towel bars
Remove shower door (allow tenant to install curtain)
Bedroom 1
Remove carpet
Paint walls ceiling and trim
Fix closet doors to work
Install LVT
Bedroom 2
Remove carpet
Paint walls, ceiling, and trim
Fix walls (holes)
Fix closet doors to work
Install LVT
Re-hang door (door should be in garage, but new one may be needed)
General
Install new door hardware
Garage door inspection (garage door opener doesn’t work)
Bug bomb unit
Clean unit when done
Install new outlets and switch make them white
Check windows to operate
Other
HVAC (furnace needs new filter)
Dumpster service
Washer box hookups are loose
Snake sewer line
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Jay HinrichsBusiness Member
Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
7y
@Ryan Fox what you describe is paint and carpet and general cleaning.. with new floors through out and a stove
5 to 6k..
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Lien VuongBusiness Member
Real Estate Agent · Boston, MA · Member since 2018 · 2k+ posts · 1k+ votes
7y
That is rally exorbitant to me frankly considering the unit is not that large. While there are certain premiums for reliable workers and timely projects that seems definitely on the top end of the estimate I would have predicted for a project like this. Are they not charging you a high percentage in management they're making it in the back end with turnovers?
You should ask them when can get it completed by and at least get one outsider quote so to compare what the market rate would be. Make sure you're comparing apples to apples for the scope of work to make an even comparison and have a frank conversation with your PM company. You don't want to have mistrust from the beginning.
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Matthew Paul
Severna Park, MD · Member since 2013 · 7k+ posts · 7k+ votes
7y
Thats a great price , it you are the contractor on the receiving end . Remember the PM is marking it up to cover their time , what % who knows ? If you are local to the property , I would roll up my sleeves and do the carpet removal , painting , minor repairs and have a flooring company lay the new floor . As @Jay Hinrichs said its 5 to 6K , less than that if you get in there .
A PM either subs out the work or has in house workers . Either way they have no incentive to do the work or get it done for less money .
2 Reply
Jay HinrichsBusiness Member
Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
7y
Originally posted by @Matthew Paul:

Thats a great price , it you are the contractor on the receiving end . Remember the PM is marking it up to cover their time , what % who knows ? If you are local to the property , I would roll up my sleeves and do the carpet removal , painting , minor repairs and have a flooring company lay the new floor . As @Jay Hinrichs said its 5 to 6K , less than that if you get in there .
A PM either subs out the work or has in house workers . Either way they have no incentive to do the work or get it done for less money .
Plus at this time is a perfect time to convert from carpet to some of the new tough flooring on the market. Carpet and rentals don't go together. most rentals carpets will be toast almost annually. some of my vendors will start with a coffee color carpet and they just keep dying it to match the stains.. until they finally have it black and need to change it out..
but these new tough flooring options to me make carpet an after thought Even in my personal homes I use very little anymore.
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Account Closed
Rental Property Investor · Central, FL · Member since 2016 · 950 posts · 821 votes
7y
I have a similar unit. Had to turn it over and scope of work was similar to yours, however I used real tile, brand new fridge, new toilet, repainted the entire home and cleaned top to bottom 5,400 out the door.
youre Getting taken advantage of. Get an outside quote for all those items. If it is considerably under what you were quoted Find a new PM. Good luck
3 Reply
Ryan Fox
OP
Investor · NV and CA · Member since 2016 · 375 posts · 227 votes
7y
@Lien Vuong - They are pretty much charging market rates for their PM service. In addition to the monthly fee, they are charging me a 5% fee for the rehab plus a fee for placing the new tenant. This seems all in line with market rates for this service. Of course, my favorite PM in the world in Chicago doesn't charge the 5% fee for rehab.
1 Reply
Ryan Fox
OP
Investor · NV and CA · Member since 2016 · 375 posts · 227 votes
7y
@Matthew Paul- good suggestion - I would totally go out there and do it myself if I didn't have a wife and kids.
0 Reply
Account Closed
Rental Property Investor · Central, FL · Member since 2016 · 950 posts · 821 votes
7y
Originally posted by @Ryan Fox:

@Lien Vuong - They are pretty much charging market rates for their PM service. In addition to the monthly fee, they are charging me a 5% fee for the rehab plus a fee for placing the new tenant. This seems all in line with market rates for this service. Of course, my favorite PM in the world in Chicago doesn't charge the 5% fee for rehab.
5% on top of insane turnover costs. And this is why I do a hybrid approach to PM. My rule is as an investor I am the one that makes the most money with my investment not someone that “manages” a unit. I just couldn’t imagine
So your PM company slices 10% off the top, then charges you what a half months rent or something else? Then during turnover they pad their pockets more with an additional 5% for what exactly? That’s 600 dollars of your 12,000 for them to make a few phone calls. So their cut of your rental is 18-20% of the gross rent, plus they have no incentive to do inspections because they can just slice some off during turnover as “rehab” costs
Do you make any money on this property?
0 Reply
Matthew Paul
Severna Park, MD · Member since 2013 · 7k+ posts · 7k+ votes
7y
Originally posted by @Ryan Fox:

@Matthew Paul- good suggestion - I would totally go out there and do it myself if I didn't have a wife and kids.
Forgive me , but I have wife and kid also , I dont see the reasoning . I have been taking my boys with me on my properties doing repairs since they were 5 and 6 . My motivation would be to do it myself and the money I saved would be a nice trip for the family .
5 Reply
Steve K.
Honolulu, HI · Member since 2017 · 247 posts · 315 votes
7y
Originally posted by @Jay Hinrichs:

Originally posted by @Matthew Paul:
Thats a great price , it you are the contractor on the receiving end . Remember the PM is marking it up to cover their time , what % who knows ? If you are local to the property , I would roll up my sleeves and do the carpet removal , painting , minor repairs and have a flooring company lay the new floor . As @Jay Hinrichs said its 5 to 6K , less than that if you get in there .
A PM either subs out the work or has in house workers . Either way they have no incentive to do the work or get it done for less money .
Plus at this time is a perfect time to convert from carpet to some of the new tough flooring on the market. Carpet and rentals don't go together. most rentals carpets will be toast almost annually. some of my vendors will start with a coffee color carpet and they just keep dying it to match the stains.. until they finally have it black and need to change it out..
but these new tough flooring options to me make carpet an after thought Even in my personal homes I use very little anymore.
LVT is new tough flooring...
1 Reply
Ryan Fox
OP
Investor · NV and CA · Member since 2016 · 375 posts · 227 votes
7y
@Jay Hinrichs - What's the name of the new tough flooring? I've heard of a lot of people recommending LVT.
0 Reply
John Thedford
Real Estate Broker · Naples, FL · Member since 2013 · 9k+ posts · 6k+ votes
7y
That bid sounds sky high. LVT is definitely the way to go or go with ceramic tile (my preference is tile).
0 Reply
Hadar OrkibiPro Member
Rental Property Investor · USA / NZ · Member since 2016 · 1k+ posts · 812 votes
7y
@Ryan Fox I agree with Mr @Jay Hinrichs. this should be $7 Max and including new kitchen and bathtub, toilet and vanity.
5% Project management fee is Fair and Common, But they are over charging on the rehab for sue!.
Get another quote !
1 Reply
Tim Grillot
Member since 2018 · 25 posts · 23 votes
7y
My wife and I just did almost exactly the same re-hab. Ours was slightly smaller (780sqft), we decided to do it ourselves as we wanted the experience for when we start dealing with contractors. It had not been touched for 13 years and everything was pretty worn. She did all the wall repair, and I did the floors/fixtures/window coverings/plumbing/etc. It took us 3 weekends and 6 nights after work to complete it, but we were kind of in play mode....we had a blast doing it. In the end it cost us $1600 in materials and looks as good or better than what a contractor would have done!! this was a property were just bought and this unit was vacant when we purchased it. It previously rented for $450/mo, and after the re-hab we rented it for $650, and it only took 3 days to get someone moved in from the day we listed it.
2 Reply
Jason Powell
Beaverton, OR · Member since 2014 · 118 posts · 119 votes
7y
I'd agree with others that 12k is too high, but I'd personally say 5k is too low. My guess is somewhere around 8k. There are just so many variables. I've renovated about 16 comparable units in the last 2 years, and they all vary in their difficulty. Very possible to find floor rot when you pull up certain areas of the floor, etc. Technically you need to get permits for some of this tiny electrical and plumbing work. A lot of people use handyman types under the radar to set toilets and replace water fixtures, but if you're hiring legit plumbing and electrical companies, even something as easy as swapping all the plugs, switches, and a few light fixtures will cost you $1k.
2 Reply
Ryan Fox
OP
Investor · NV and CA · Member since 2016 · 375 posts · 227 votes
7y
@Tim Grillot - I love to do stuff around the house, but tackling a project as big as this and traveling from NV to MO to do it is just not practical, especially because I just took 3 weeks off work.
1 Reply
Clifford Paul
Rental Property Investor · Member since 2018 · 483 posts · 956 votes
7y
Nothing more to add but to say 12k is ridiculous. So glad I'm in Texas where you can still get work done at a reasonable cost.
2 Reply
Tim Grillot
Member since 2018 · 25 posts · 23 votes
7y
Originally posted by @Ryan Fox:

@Tim Grillot - I love to do stuff around the house, but tackling a project as big as this and traveling from NV to MO to do it is just not practical, especially because I just took 3 weeks off work.
Ahh...that makes sense, I didn't realize the geography difference! 12k seems high for that, here in Kentucky it would be around 5k for what you listed.
1 Reply
Lee Bell
Real Estate Appraiser · Isabella lake, CA · Member since 2018 · 628 posts · 491 votes
7y
My Momma told me, you better shop around.
0 Reply
Ian WalshBusiness Member
Lender · Philadelphia, PA · Member since 2016 · 2k+ posts · 1k+ votes
7y
It's certainly possible for that to be the renovation amount. It depends on what is being done, sqft etc.
0 Reply

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