Rehab Strategy Advice Need

[Jasper Li]

Hi BP community,

I am trying to figure out the direction I want to go with the rehab of my duplex. I can create an open floor plan by changing a bedroom into the kitchen and kitchen into a bedroom. Is it worth it? Open floor plans seem more desirable to rent but this renovation would be costly (moving walls, plumbing, electrical, etc). Would this effect the refinance portion of the BRRR since this unit becomes more modern?

Also, what about adding a bathroom? It's currently a 2 br 1 ba. What if I change 1 of the walking closets to a second bathroom? I know it could rent for a little more but the cost of installing a second bathroom is pricey, will the value add be worth the rent + refinance?

Thanks in advance

[Gregory Schwartz]

Its very market specific. In College Station, TX the difference between a 1 bath and a 2 bath duplex is $100 / month. And layout help maybe by $200 / month. So if you combine the 2 you can get a $300 / month increase. If you want a 15% return on your upgrades (open concept and additional bathroom) then you'd have to keep the cost under $24k. 

Not possible in my market so we just stick to improving what we have cosmetically.