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Hi Bigger Pockets,
I've been studying REI for the lion share of this year and am now ready to start analyzing a large volume of deals before making offers. My goal for the next year is to build a small portfolio of rental SF rental properties before 2021. I have a Credit and Treasury background by trade and I'm hoping to carry those skills forward into investing.
My Problem: I am having trouble developing confidence in my rehab estimates while looking through images of properties on listing website. I've read a few books and can sit here on the computer assigning what I think to be accurate rehab estimates but I ultimately have no way of "checking the work" on what I'm doing.
My Ask: I've included my train of though on each of the rehab categories below. My hope is that someone will take the time to review my thinking through each of these criteria and point out any huge mistakes I am making.
Thanks in advance for any help you can provide.
ROOF: Roof has discoloring in several places as well as several lifted shingles. Most likely due for a new roof in the next few years provided there is no water coming through. Estimating $500 for immediate repairs.
GUTTERS: Gutters look discolored, but I don’t see any that are rusted or disconnected from the roof. Going to factor $250 to clean all of them.
SOFFIT, AND FASCIA: I don’t have a great view from the pictures but since there doesn’t seem to be anything immediately wrong with the gutters I will leave this be for now.
SIDING/SHEATHING/HOUSE WRAP: Everything looks to be intact here but very dirty. The whole house will need to be pressure washed. Factoring $200 here.
EXTERIOR PAINTING: After the pressure wash I feel that the house will look presentable. The deck will need to be repainted as well as the back stairs. I’m factoring about $.50 per foot of interior floor space which equals $616.
DECKS AND PORCHES: Everything looks structurally sound here so I’m not going to factor for any repairs or replacements here.
CONCRETE: Nothing that can really be gathered from the pictures. This would be something left to the inspection. For the sake of experience, I’m going to assume I would pour a new concrete driveway off to the side. Estimating about $80 Sq. Ft. at $4,800
GARAGE: The house has no garage, but it does have a shed in the backyard. I would more than likely keep this locked and unavailable to the tenants. It looks to be in alright shape, so I will leave it alone.
LANDSCAPING: Going to factor the initial yardwork into the analysis here. All that seems to be required is a mow. Going to put this at $50.
SEPTIC SYSTEM: N/A this property is on public sewer.
FOUNDATION: I don’t see any red flags in the picture. I can only assume a cost of $0 until the inspection.
DEMO: This property doesn’t look like it will need any type of significant demo. I won’t be ordering a dumpster or factoring for labor.
PLUMBING: There’s no real way to check for plumbing issues from pictures so I’m going to at least factor for a service call at $100. The one picture of the bathroom looks to be in bad condition so I’m going to assume this carries true for the other 1.5 bathrooms as well. The tub looks to be in place so I’m assuming new tile work only for both bathrooms at around $10 per Sq. Ft. for 180 Sq. Ft. totaling $1,800. I can’t get a good read on any of the fixtures so I’m going to assume these are all still useable.
ELECTRICAL: I don’t see any missing fixtures or fans so I’m going to assume these are fine. I won’t be able to determine anything further until the inspection. The house was built in 1995 so I’m hoping that there’s no aluminum wiring or other issues associated with older homes.
HVAC: I’m seeing a few floor and ceiling returns in the pictures as what looks to be a tiny air conditioner unit and propane tank in the back yard. One of my concerns is that on the street view there appears to be an air conditioner in the window. For right now I’m going to factor for $0 until another BP member can help me add some color here.
FRAMING: Not applicable.
INSULATION: Going to factor for $0 until the inspection.
SHEETROCK: No visibly large holes to be seen in the pictures. Factoring for $0 here.
CARPENTRY – DOORS, WINDOWS, TRIM: All the doors and windows appear to be intact and in good condition, even if they do look a bit cheap. Factoring for $0 here.
INTERIOR PAINTING: This entire house will need to be repainted. Factoring $2.25 per Sq. Ft. of interior space totaling $2,772
CABINETS AND COUNTERTOPS: The kitchen countertop and most of the cabinets throughout the house are in surprisingly good shape. I see one cabinet that will need to be repaired in the kitchen and I’m going to assume that the door to the cabinet in the bathroom is missing. I should just need to 1) fix the kitchen cabinet and 2) reface the bathroom cabinet which shouldn’t be more than $300.
FLOORING: It is hard to tell but it looks as though there is only subfloor remaining in the kitchen and in the main hallway. There is really very little flooring that can be salvaged from my viewpoint. This would need 100% of the floors replaced. Using the newer vinyl for the entire downstairs and all bathrooms should be around $2.00 per Sq. Ft. for materials and labor and carpet for the upstairs should be around $1,470 for the roughly 732 Sq. Ft. of carpeted space I estimate. while the carpet and padding should be around $28 per Sq. Yard; this should end up being around $1,820 for the remaining 500 Sq. Ft.
PERMITS: Going to factor around $400 for inspections and $2,546 for a GC to run the entire project.
MOLD: No signs of mold.
TERMITES: No signs of termites.
MISC: Budgeting $2,000 for misc. tasks. All appliances look to be in good shape, so I will be leaving these as is.