How to REHAB with tenants in place?

2 Replies

I'm a newbie and the part I get hung up on is if, for instance, you find a 4plex with 4 long term tenants in place, how do you pull off the REHAB if they are in the apartments? I know this sounds like a minor thing to experienced investors, but I keep getting stuck when I try to imagine how I work around tenants to get all the apartments fixed up so I can raise the rents, the appraisal value and then refinance. 

Do you do the work while they are there?

Wait till a lease is up move that person out, fix that one, then repeat for each one?

I always imagined it's less money and hassle to pull off the whole rehab at once, but not sure how people are doing that.

I'm sure there is more than one way to do this, but I'd love to hear from some of folks who have pulled this off successfully.


It depends a lot on how far below market their rents are. Long term tenants can be a major pain when it comes to increasing the income on a property when renovation is necessary. It is best to reno one unit at a time when tenants turn over but if they do not want to leave you will have to force them out.

What you do is raise their rents to full market one tenant at a time and if they leave you then reno and find a new tenant at the new full market rent. Depending on how fast you reno you should be able to bring one unit to full market every two months.

Don't make the mistake of getting attached to the existing tenants. If they are paying under market they know it and also know that with a new owner there will be change. If they are all under market and you need to reno get rid of them if they are not willing to pay market rent with the units as is..  If you invested in the property with the intent  to increase profit get them all to market asap.    

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