How to Determine Max Rehab Costs for Rental in Lakewood, OH
Hi everyone,
I'm a new owner of a double in Lakewood. I'm living in the bottome unit, and the top 2/1 is currently being vacated. I have an additional 3rd floor which is not currently livable due to no HVAC, and it has enough space to add a large master bedroom, and an additional bathroom with a sitting area.
My question is how do all of you determine the maximum price you are comfortable with spending on your rehabs? It seems like current market rent for the upstairs 2/1 is about $850 month. Remodeling the 3rd floor and adding the bedroom and bath to make the upstairs unit a 3/2 seems like it would bring the rent to a minimum of $1250 to maybe even $1400. So the difference I would be getting in rent is at mimimum $400 to maybe a $550 difference compared to the current rent.
How long of a payback in addional rent do most of you consider to be warranted? I just received a quote which was much higher than anticipated to redo the third floor, and I wanted to hear some input on the subject.
Please feel free to give any feedback on current market rents also. My double is on Cook Ave between the tracks and Clifton, so it is in a great location.
Vic