Did I get Ripped Off for a Unit Turn?

Question

I'm an out-of-state investor and I'm not too much of a handyman so I'm not sure about prices but I just wanted to get a sanity check from those with more experience. I had my property management company turn over a unit for me recently and I'm just wondering if I could lower my costs by using a local handyman next time. I don't mind paying people for their work but I just want to know what's reasonable and what's not. Please let me know what you all think.

I recently paid $3850 for this:

Garbage removal- Minor garbage removal can be done by techAlarms- 1 combo needed- 1 combo needed in basement- 1 smoke alarm needed

Maintenance- Check all doors for proper closure and catch- Complete punch list- Remove blinds and hardware- Remove old alarms and brackets- Install door stops as needed- Remove old cables from walls- Remove plastic and tape from windows and doors- Remove shelving from back of hallway closet door- Install sliding closet doors in back left bedroom (one door in kitchen)- Replace back left bedroom door 30” (hole)- Remove storage rack above toilet- Scrape and caulk bathtub

Plumbing- Install aerator on kitchen faucet- Install shower head

Electrical- Replace lightbulbs as needed- Install light cover in kitchen- Install light cover in front bedroom- Install missing outlet cover in front bedroom- Install light cover in back left bedroom- Attach light cover in hallway- Install GFCI outlet in bathroom- Attach light cover in back right bedroom- Install blank handle on back right bedroom

Painting- Remove all unused hardware from walls and trim- Remove old door bell box from hallway- Remove security box from wall in back right bedroom- Paint all walls (Amazing grey)

Flooring- Carpet worn and stained (618 Sq Ft.)(Remove carpet only)- Living room 12x16- Hallway 3x25- Front bedroom 11x12- Back left bedroom 9x11- Back right bedroom 10x12

Plus another $240 to remove staples and tact strips due to the carpeting. I left the floors as hardwood (except the kitchen where I spent another $940 on LVP).

Martin Zawarski · Answer

@Andrew C.

I would never buy a home more than 15 minutes from where I live.   This is a hands on business.  I own 40 homes.  I keep my eyes open to everything I own.  I manage my properties.  At 67 I still actively work on my homes.  It keeps me young (and tired) oh well!

Laura Stayton · Answer

This seems reasonable to me.  Of course we always send estimates for prep to owners for approval before work begins so it's transparent.  There could be a few things that come up as they go and we get estimates and approval for that as well but this way there are no surprises.

Turnovers cost money.  That's why the goal is always to keep a good tenant by way of smaller rent increases at renewal as opposed to bringing them up to full market rent.

Richard F. · Answer

Aloha,

Who placed the Tenants? I would be looking for significant improvement in the screening process. Your turnover cost was not terrible, but also would be painful if every turnover was the same or worse. You should also be inspecting the unit annually to ensure unreported issues are not causing costly damage.

You want to attract the top 10% of the Tenant pool for your price range, and properly screen each adult. You also must ensure they have a clear understanding of the terms of your rental agreement and their responsibilities as your Tenant. Returning the unit in the same or better condition as they received it would be a point to stress with them at signing. This would include a brief discussion of just what is considered "normal wear and tear".

Chris Seveney · Answer

@Andrew C.

That doesn’t seem too bad. How large is the unit?

What is the rent?

It’s good people post this to see what it actually costs to maintain a unit as 90% of people include 1/3 of that for unit turns and wonder why they do not cash flow at end of day

Steve K. · Answer

This doesn't seem bad at all. It would be a lot more here (and where you are in NYC I imagine).

Theresa Harris · Answer

A PMC should have a list of contractors that they use frequently to do this.  Turnovers are expensive for the owner and they pay extra to the PMC for showings and getting a new lease in place.  If they do their tenant screening well and have the place in good condition, then every month they are being paid 8-10% of the rent to simply make sure rent is paid and then pay the owner their percentage.

Scott Mac · Answer

$3800 a turn X 10 turns = a brand new F150.

Too bad your not more of a handyman.

https://shop.ford.com/configure/f150/model/customize?intcmp=vhp-bb-fbc

Its important that things get done, quickly and in a professional looking manner vs just being the cheapest in town.

What I am saying is it's (also) important to Judge the outcome by the quality of the work, and the speed (to prevent excessive downtime).

Cheapest is not always best. Sometimes it's better to pay a little more for a quality contractor.

Good Luck!

Theresa Harris · Answer

Things like replacing light covers, smoke alarm, caulking are dirt cheap.  Major costs would have been replacing all of that flooring and painting (while paint is cheap, the labour isn't).  Some of the stuff I don't get (remove storage rack, install shower head, remove blinds), also garbage removal should have come off the tenant's deposit along with anything else associated with stuff they did.

I agree with Carl-the PM should have gotten 2-3 quotes for the big items (flooring and paint).  Yes a handyman may have been able to do the rest for less, but without a breakdown of what went to flooring and paint, it is hard to tell.

Carl Millsap · Answer

@Andrew C.   If that total is labor and materials then it's probably not to far off. Depends if they used in house maintenance or contracted it out for labor.

Materials are out of hand. A box of LVT I was buying at $40 a box last year is now $87. Crazy!!

When I had a property manager (PM) I asked for three quotes for turns.

My PM at the time was using her husband's company which I thought should've been disclosed. Of course his quote came in the lowest every time . I called and arranged for 3 contractors to look at the unit w/o her. I saved $3K on a turn by doing that.

Consider most PM don't make a lot of money from management fees; not saying that's a license to pad cost elsewhere, just an observation.

Hopefully the increase in rent will shorten the time to breakeven on those expenses.

Michael Smythe · Answer

@Theresa Harris and you pay car, home & life insurance why?

Did I get Ripped Off for a Unit Turn?

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