Recently acquired duplex for $29k req some rehab-need advice

17 Replies

Good afternoon and happy NEW YEAR,

Recently purchased a Brick duplex (3bd,1.5ba & 2bd, 1ba) for $29k  approx one hour north of Indianapolis, Indiana and I am very satisfied with the deal. My experience entails of minor home repairs and assistant to my father growing up installing cabinets, hardwood floors, and tile jobs.  I am currently in aircraft maintenance and am fairly handy when it comes to repairs and troubleshooting problems.  This is our second property, our first was a turnkey triplex.  So below is the questions I have.

1. The duplex currently has baseboard heat. I would like to retrofit a high-velocity A/C & Heating system.  Whats the cost for creating two separate systems to keep the utilities separate? or Is it not cost effective to swap this out?

2. I already purchased Jay Scotts-estimating rehab costs and I am very happy with my purchase.  However, the duplex is in my home town and I am currently Active Duty Military overseas so I will be outsourcing the work.  My idea is to create simple contracts for jobs (i.e Contract for: CONTRACTOR Address:### Street,City, State Task:TASK Description Cost:$XXX.XX) for each task to get exactly what I expect.  Is this a smart decision?

3. I am in search of a mentor to have one on one communication with who is familiar with the Midwest market. 

Thank you for your time and Happy Holidays,

Jordan

My intent is to Buy and Hold.

Originally posted by @Jordan Thompson :

Good afternoon and happy NEW YEAR,

Recently purchased a Brick duplex (3bd,1.5ba & 2bd, 1ba) for $29k  approx one hour north of Indianapolis, Indiana and I am very satisfied with the deal. My experience entails of minor home repairs and assistant to my father growing up installing cabinets, hardwood floors, and tile jobs.  I am currently in aircraft maintenance and am fairly handy when it comes to repairs and troubleshooting problems.  This is our second property, our first was a turnkey triplex.  So below is the questions I have.

1. The duplex currently has baseboard heat. I would like to retrofit a high-velocity A/C & Heating system.  Whats the cost for creating two separate systems to keep the utilities separate? or Is it not cost effective to swap this out?

2. I already purchased Jay Scotts-estimating rehab costs and I am very happy with my purchase.  However, the duplex is in my home town and I am currently Active Duty Military overseas so I will be outsourcing the work.  My idea is to create simple contracts for jobs (i.e Contract for: CONTRACTOR Address:### Street,City, State Task:TASK Description Cost:$XXX.XX) for each task to get exactly what I expect.  Is this a smart decision?

3. I am in search of a mentor to have one on one communication with who is familiar with the Midwest market. 

Thank you for your time and Happy Holidays,

Jordan

My intent is to Buy and Hold.

 Jordan, thank you for your service in the military.    Good luck with your duplex, very interested in hearing how things go with it.

Originally posted by @Jordan Thompson :

Good afternoon and happy NEW YEAR,

Recently purchased a Brick duplex (3bd,1.5ba & 2bd, 1ba) for $29k  approx one hour north of Indianapolis, Indiana and I am very satisfied with the deal. My experience entails of minor home repairs and assistant to my father growing up installing cabinets, hardwood floors, and tile jobs.  I am currently in aircraft maintenance and am fairly handy when it comes to repairs and troubleshooting problems.  This is our second property, our first was a turnkey triplex.  So below is the questions I have.

1. The duplex currently has baseboard heat. I would like to retrofit a high-velocity A/C & Heating system.  Whats the cost for creating two separate systems to keep the utilities separate? or Is it not cost effective to swap this out?

2. I already purchased Jay Scotts-estimating rehab costs and I am very happy with my purchase.  However, the duplex is in my home town and I am currently Active Duty Military overseas so I will be outsourcing the work.  My idea is to create simple contracts for jobs (i.e Contract for: CONTRACTOR Address:### Street,City, State Task:TASK Description Cost:$XXX.XX) for each task to get exactly what I expect.  Is this a smart decision?

3. I am in search of a mentor to have one on one communication with who is familiar with the Midwest market. 

Thank you for your time and Happy Holidays,

Jordan

My intent is to Buy and Hold.

 Jordan, did you get a home inspection done on the property?  The would give you an idea on the condition and age of the Boiler System for the baseboard heat.

I have never knew how to respond to people when they say "thank you for your service" but when it comes up I always feel some since of gratitude followed by an immediate hard to explain undeserving feeling.  I am blessed with a low deployment tempo that will never see outside the wire.  A training and experience that many aviation employers are looking for.  A very beautiful supporting wife(who also is in the Air Force) and a family that also supports my dreams and goals no matter how far out of reach they may seem at the time. So when I hear the words "thank you for your service" I instantly think they are referring to those who don't have the luxuries I have. 

Now that is out of the way does anyone have any answers to my questions? :) 

Is this all on slab or crawl space? Present baseboards are hot water on boiler or electric baseboard?  Each tenant pays there own  heat,,,right?  General condition of present system?  Sorry for all the questions but trying to get enough info to help.

"MY" favorite heat system is each tenant having own PVC vented gas furnace,,,ducted as necessary either thru crawl space,(Preferably) or over the top in the attic with lots of insulation covering.

This leaves a way to use same system for central air with an outside unit and inside A coil.

Electric baseboard in every room  would be least fav, as energy cost much higher and results less satisfiying and no a/c option other than a whole system

These pvc vented furnaces are small and are low gas users.  I can heat a small home in the brutal midwest winter here for 50 - 100 bucks a month on coldest and less either side of that.  Natural gas is the cheapest heat.  AND tenants like cheap too.

Jordan,

I have had very similar properties in the past and the previous questions by Don are  answers you will need to start a productive conversation. I will be happy to talk with you and see what advise i may offer. Please feel free to contact me.

Congratulations on your purchase.  I am a former USAF guy (with some amrny national guard sprinkled in as well) and we do buy and hold up in South bend but have also bought houses an hour south and have looked as far south as Peru so have a small bit of experience close to your duplex.  Would be glad to look at and also discuss what you are planning.  I also prefer (as does everyone I bet) any heating that is not baseboard (can you let us know if that is water or electric).  That said though I have one with baseboard that the tenant is happy with and they pay heat so I may never change it.    If your interested in connecting just shoot me a message.  I am back in town next week and should have some time mid week or later than that.

Good Luck

If it ain't broke don't fix it. Leave the baseboard for now unless the expense of heating is immensely too much. Shouldn't you be able to have the tenants pay heat and electric or are they not on separate meters? If not, I'd suggest doing that instead of upgrading the heating system. 

@Jordan Thompson , you mention a "high-velocity" A/C and heating system which is very different than a low-velocity system.  Are you aware of the differences?  What will be the energy source to operate the system (electric, gas, oil...)?

You've also mentioned separating the utilities... as I understand it, meaning separating the baseboard operating costs from the A/C and heating system cost??  If my understanding is correct, why would the existing baseboard system remain if a central system is being added?

As for using simple contracts... please do some more reading of the forums.  Success is more likely using very detailed contracts.  A well executed contract is one that leaves little ambiguity.

@Account Closed . In regards to the High-velocity AC.  From my understanding that is the best way to retrofit central air due to the lack large duct work.  I have no first hand experience with Central Air/Furnace installation just common maintenance. 

For the contracts.  My goal is to be detailed but without over complicating a contract with multiple jobs.  In the event they fail to meet the standards outlined in the contract. I can follow those steps to A. make them come up to the standards previously outlined or B.find someone else.  So really my question is should I write individual contracts for Individual jobs or one large contract to include all the work the contractor will be doing?

@Jordan Thompson I think you will find that the high velocity systems are quite expensive.  Likely way over budget for your $29k rental. 

Depending on the layout, you might be able to easily accommodate traditional HVAC systems.  I have seen alot of houses where the HVAC air handler was installed in a central closet and the hallway ceiling was dropped to route the duct work.  I have personally done this in a duplex retrofitted with AC on the first floor unit (second floor used the attic space).  It dropped the ceiling 12in.  

For a conventional system, I would expect to pay $5k for the 2/1 unit and likely $7k for the 3/1.5 unit.  That would not include any carpentry work needed for any drop ceiling or boxed in soffits for ducting.

I have used high velocity system on ships, and they can be quite noisy, no idea about in a house, but I assume it would be the same (as generally velocity equals noise with air movement).

On the contract side of things, I would only do one contract per contractor, listing each item that needs to be done and its costs.  I think if you break every item into a separate contract, it will cost you more money, as the contractor will not have the guarantee of all of the work and thus charge accordingly (i.e. setup and hassle charges for each task).

Originally posted by @Jordan Thompson :

@Michael Paris. In regards to the High-velocity AC.  From my understanding that is the best way to retrofit central air due to the lack large duct work.  I have no first hand experience with Central Air/Furnace installation just common maintenance. 

For the contracts.  My goal is to be detailed but without over complicating a contract with multiple jobs.  In the event they fail to meet the standards outlined in the contract. I can follow those steps to A. make them come up to the standards previously outlined or B.find someone else.  So really my question is should I write individual contracts for Individual jobs or one large contract to include all the work the contractor will be doing?

 Yes, high-velocity systems are common in retrofit applications when standard ducted systems aren't possible/practical... please just educate yourself on them (as with any type of system) to understand the pros and cons to ensure success with your purchasing decision.

As far as contracts go, if you're hiring a GC, then one contract should suffice.  If you're hiring individual trades yourself, then you'll need a contract for each one.  In either case, the entirety of the Scope of Work is identical whether contained in a single or multiple "contracts".

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