All Forum Posts by: Matthew Nicholson
Matthew Nicholson has started 2 posts and replied 9 times.
Post: Update 2021 Rehab Budget Estimates
- Medford, OR
- Posts 9
- Votes 1
Looking for my next flip (sold 2 houses in March, then took a break), and I'm hearing from everyone that materials have gone through the roof (heh).
I spent some time today going through NAHB, BLS, BOL, CNBC, etc. looking for year-over-year increases, including overall inflation numbers from ShadowStats. I've also polled several of the people in my network (contractors, flippers, wholesalers, brokers) asking what they are seeing.
Below is my updated budget (padded) for Spring/Summer 2021. (1) Note that the 2020 numbers are a padded (I pad everything) high average of budgets pulled from 4 houses I flipped in the PNW in 2019-2020. (2) If the official numbers were below inflation, I used Inflation (Shadowstats.com). (3) The overall increase in price on my breakdown is close to the overall data I've found online, which makes me think I have a decent updated budget for eyeballing deals with. (4) To reiterate, the numbers I started with were unique to my situation in the PNW, so please don't take them as gospel for you!
| Full gut/rehab (3/2 SFR) | 2020 | 2021 April | Multiplier Materials* | Materials % of job | Multiplier Labor | $ Increase | |
| 01: Plans / Permits | Plans / Permits | $ 5,000 | $ 5,500 | 10% | 0% | 10% | $ 500 |
| 02: Demolition | $ 5,000 | $ 5,500 | 10% | 0% | 10% | $ 500 | |
| 03: Foundation | $ 20,000 | $ 22,000 | 10% | 50% | 10% | $ 2,000 | |
| 04: Roof / Gutters | $ 17,000 | $ 18,870 | 12% | 50% | 10% | $ 1,870 | |
| 05a: Exterior Paint | Exterior Paint | $ 7,000 | $ 7,700 | 10% | 50% | 10% | $ 700 |
| 05b: Siding | $ 5,000 | $ 5,500 | 10% | 50% | 10% | $ 500 | |
| 06: Windows | $ 5,000 | $ 5,500 | 10% | 50% | 10% | $ 500 | |
| 07: Garage | $ 5,000 | $ 5,500 | 10% | 50% | 10% | $ 500 | |
| 07b: Driveway | $ 5,000 | $ 5,500 | 10% | 50% | 10% | $ 500 | |
| 08: Framing | $ 5,000 | $ 9,500 | 170% | 50% | 10% | $ 4,500 | |
| 09: Finish Carpentry | $ 5,000 | $ 9,500 | 170% | 50% | 10% | $ 4,500 | |
| 10: Sheetrock / Insulation | $ 20,000 | $ 22,000 | 10% | 50% | 10% | $ 2,000 | |
| 11: Interior Paint | Interior Paint | $ 7,000 | $ 7,700 | 10% | 50% | 10% | $ 700 |
| 12a: Flooring (laminate) | Flooring (laminate) | $ 5,000 | $ 5,500 | 10% | 50% | 10% | $ 500 |
| 12b: Flooring (carpet) | Flooring (carpet) | $ 5,000 | $ 5,500 | 10% | 50% | 10% | $ 500 |
| 13: Kitchen | All new cabs & countertops | $ 7,000 | $ 9,940 | 170% | 20% | 10% | $ 2,940 |
| 14: Bathroom | $ 5,000 | $ 5,500 | 10% | 50% | 10% | $ 500 | |
| 15a: Plumbing Rough | $ 7,000 | $ 7,700 | 10% | 50% | 10% | $ 700 | |
| 15b: Plumbing Final | Fixtures, water heater, garbage disposal, dishwasher | $ 2,500 | $ 2,750 | 10% | 50% | 10% | $ 250 |
| 16a: Electrical Rough | $ 7,000 | $ 8,400 | 30% | 50% | 10% | $ 1,400 | |
| 16b: Electrical Final | Fixtures | $ 2,500 | $ 3,000 | 30% | 50% | 10% | $ 500 |
| 17: HVAC Work | $ 5,000 | $ 5,500 | 10% | 50% | 10% | $ 500 | |
| 18: Appliances | Range, Garbage disposal, dishwasher | $ 4,000 | $ 4,400 | 10% | 0% | 10% | $ 400 |
| 19a: Yard | Cleanup | $ 2,000 | $ 2,200 | 10% | 50% | 10% | $ 200 |
| 19b: Fence | $ 5,000 | $ 9,500 | 170% | 50% | 10% | $ 4,500 | |
| 20: Basement / Crawlspace | Vapor barrier | $ 3,000 | $ 3,300 | 10% | 50% | 10% | $ 300 |
| Contingency | Stuff happens | $ 5,000 | $ 5,500 | 10% | 50% | 10% | $ 500 |
| trash haul | Final trash load | $ 500 | $ 550 | 10% | 0% | 10% | $ 50 |
| mow lawn | $ 500 | $ 550 | 10% | 0% | 10% | $ 50 | |
| Staging | $ 3,000 | $ 3,300 | 10% | 0% | 10% | $ 300 | |
| $ 180,000 | $ 213,360 | $ 33,360 | |||||
| 16% |
Does this make sense? Have you used a different method to accommodate rising prices in your budget estimates?
TL;DR I can just add 16% to my cookie-cutter eyeball budget from 2020.
Post: Help! What if I can't sell my flip during the virus?
- Medford, OR
- Posts 9
- Votes 1
Haven't been on here for a while, but here's how it shook out:
HML gave me an extension, I switched RE Agents, found a buyer, Angel Investor came in with the cash to finish the project and everyone got their money back (except me, I took the L as punishment so I would never forget my mistakes).
Post: Help! What if I can't sell my flip during the virus?
- Medford, OR
- Posts 9
- Votes 1
@Caleb Heimsoth Thanks for your response!
I purchased it with a few other investors June last year, and everything went wrong with the rehab schedule. It is HML, the monthly interest-only is $2050.
Including 8% closing costs (realtor 5% + title/escrow 3%), my breakeven today is sale @ 362k. I am not bankable, no w-2, and my other partners aren't bankable either. We all just had cash to make it work, not anticipating everyone being told to stay home.
Post: Help! What if I can't sell my flip during the virus?
- Medford, OR
- Posts 9
- Votes 1
Post: House Hacking Research - Tell Me Your Story!
- Medford, OR
- Posts 9
- Votes 1
Thanks for sharing! I'm looking to house hack my first investment property, and I appreciate the scary stories to keep me from getting too giddy.
Post: Any investors or RE professionals in St Helens, Oregon?
- Medford, OR
- Posts 9
- Votes 1
Late to the party, but I'm a new investor, currently living in St. Helens.
Post: How I made 144K in 21 Months House Hacking
- Medford, OR
- Posts 9
- Votes 1
Fantastic! Very inspirational. I'm looking to get into house-hacking as my first investment, looking for small multifamily in my area right now. I think the idea is brilliant.
Post: Dealing with Tenants who are bringing up laws.
- Medford, OR
- Posts 9
- Votes 1
@Louis W. Anti-gentrification?
Post: Left my W-2 job for Full-Time Real Estate 18 months ago today...
- Medford, OR
- Posts 9
- Votes 1
@Julie Kern Inspiring story, thank you for sharing. Godspeed