I am new to the site and have been looking around at small multi-families to rent out in locations within an hour drive from Boston (I will not be living in any of the units). I looked at a 3 unit property today; units are as follows:
- 1st is a 2 story small house (3BR/1BA) (I might post some specific questions related to this one in a separate post)
- 2 others are attached to the house and are each small 1 BR/1BA - layout reminds me a little of an old school motel)
- all need various levels of work
- It is a good neighborhood with strong rentals so I am interested in pursuing this one a little more and see if the numbers will work
I am working through the numbers now but am not sure how to estimate/approach the two 1 BRs because neither of them have "traditional heat". Apparently they are both heated via large gas stoves in the kitchen (i.e. the stoves are old fashioned and are supposed to be used for cooking and heating). One stove/oven looks like it might work; the other looks like it might need to be replaced. So, questions are:
- Does anyone have experience with this type of heating in a rental unit? Any issues/concerns?
- Would it be wise to replace these ovens with "regular" ovens and find a different way to heat the units?
- This is a free-standing unvented gas stove. From personal experience, when I tried to replace my free-standing stove, Lowes said it was going to be a problem because there was no way to vent it (similar to these units, the stove is not on an exterior wall). Anyone have any experience/recommendations on venting?
The purpose of these questions is to be able to estimate how much $$$ I am going to need to put into these units prior to them being rental ready to understand if the numbers would work/what offer I would have to make. Any sort of cost estimates would be greatly appreciated (I fully understand it depends on contractors, etc. - I just need to know what ballpark I would be playing in).
Thanks in advance for any advice.
Replace them I would think, in my experience the gas company may not turn the gas on for them for safety reasons. There must be some kind of gas furnace you can get. You would need to plumb the gas pipe to wherever you want it situated. We bought a 450000 BTU fireplace and installed it in a very small house some years ago and it was quite a nice way to heat it. It was vent-less. For the heat there was a heat vent above the fireplace and one going into the bedroom behind the fireplace. It might be an option to put electric in part of the unit, cheap to install but expensive to run. As for price I don't have recent furnace experience but if we could do it with a fireplace I imagine a furnace would be more straightforward. Good luck.
Lisa, these types of stoves are very common in old houses in MA. (I never saw one in NY, so I suspect they were made locally.) They are grandfathered in under code, and can be repaired but cannot be bought new. I have two in a three family house. One works fine, the other needed a minor repair. Before I purchased the property, I investigated the costs of replacing the heating systems, either with electric baseboard ($3-6,000) or a gas boiler with radiators. ($6-10,000) (FYI, electric baseboard is very expensive to use -- high bills.) I bought the house and am keeping the old units for now, while budgeting for replacements.
Replace them rebates available consider wall mounted heat and ac units. Bonus you are giving tenant ac
You can call ThomasHoyle.com he's done a few of these, replaced a stove/heater in one of my units. On his site is a building in the North End where he converted some stove/heaters. Originally he's from WR, now in Braintree. I'll message his contact info incase they scrub it from this reply.
Thank you all for your feedback - truly helpful!
This place sounds like a hodgepodge property with hodgepodge problems. Why not buy in Roslindale or Hyde Park? Or Dedham? Even a single family in those areas could be worth it. Expanded geography is good for bettering your chance on finding a good investment however I would bring a contractor by if you are really interested but, personally, I wouldn't bring a client through based on your description. Too much hassle.
Hi Donald - thanks for your input. My next step is exactly as you pointed out - bring in a contractor. I am not sure what you mean by "bringing a client through". Do you mean a renter?
I am definitely also looking at the towns you highlighted - would LOVE to find something there - I haven't seen anything yet w/i that seems to work from a numbers standpoint. I have family in a town near this property - so that is a plus for location for me.
I meant buyer, but tenants also. Based on your description I wouldn't advise a client to buy it unless the renovation budget was huge and something really cool could be done with the place. I don't want the commission if it's going to be a nightmare unless my buyer is very sure they want to go forward. Also, I don't want to be stuck with the responsibility of renting a nightmare place out (pitfalls there, also) but that is minor compared to someone unknowingly getting into a disaster.
People have to want to live there, so that is something to think of.
All the developers are moving into JP and Roslindale and Fort Hill, so any of those areas for multi-families are going to be tough to compete in, but single families aren't getting gobbled up as competitively around there. I have one client who only buys 1 bedroom/studio condos and swears by them. One, maybe two tenants most of the time, he doesn't have to: shovel, rake, fix the roof, sweep, worry about the heating system, do pest control, let the gas company in.....you get my point. Yes he is paying a condo fee each month but it is worth it for him to not have the hassle.
I have another client who is selling a multifamily because he is sick of shoveling on the weekends. Something to think of, especially when the tenants are responsible, as they are in this case.
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