I’m trying to get a general idea of the costs involved with rehabbing a property in the Central Texas area. The property that I’m interested in purchasing is located about 1 hour north-east of Austin, near Temple. I have a contract to purchase the property (3 bedroom, 2 bath, 1600 SF) at $22,500 (paying cash and will refi after repairs). Rehabbed value should be in the neighborhood of $50-55,000, but I plan on renting the property for a few years at least(should bring $650-700/mo). This property is in need of a fair amount of repairs including:
Electrical Upgrade (running off an old fuse box)
New Roof
Home exterior either needs to be repainted or get siding
Interior painting
Interior flooring throughout
Update kitchen with new cabinets
One bathroom floor needs to be completely torn out. A pier beneath the floor fell down and the floor has basically collapsed.
What I’m looking for is a general estimate for some of these items. Any assistance would be greatly appreciated!
I’d suggest a walkthrough with a contractor. It’s hard to know the extent of what your dealing with unless you can see it.
Upgrading to a 200A panel - could be as low as $500. But is that the only issue? What kind of wiring is behind the walls? If you need a complete re-wire, could be $5,000 or higher.
New roof - $2,500? for composite shingles, Just a WAG. If the decking needs to be replaced… it will cost a lot more. I was once quoted $10/sq.ft. for decking replacement, so I did it myself. Roofers have been hard to come by lately, they’re still so busy collecting insurance money from that hail storm last spring.
New paint, exterior - $2000-3000 just a WAG
New paint, interior - same as above. Figuring you could get paint, inside and out on a 1200 sq. ft. house for $5000- 6,000. Probably less if you just have them spray everything white.
Interior flooring. Huge range here. Hardwood? Carpet? Tile? Sketch out your plan, multiply the amount of flooring by the “intalled” prices at HD and add 25%. (They’re “installed” price assumes your subfloor is perfect and ready to be covered with flooring. Something always needs to be done IME.) That’ll give you an idea, then you can try to get it done for less, but you’ll have HD as a back-up.
Kitchen Cabinets. For new, low-end cabinets I would guesstimate $90 / l.f. for a basic Kitchen. So a 10 ft. galley is about $900 for the Cab’s. That doesn’t include installation or countertops.
A pier “fell down”? Sounds like you need a new foundation. Could be a deal killer.
If your replacing the floor in a bathroom, you will also be removing/reinstalling/replacing your tub, toilet sink, etc… I’d look at like a complete redo and budget $5,000.
My guesses are based on Austin. Your prices might be a lot cheaper in Temple, I dunno. If the ARV is $50K, you might be able to get away with a lot cheaper material, or substitute “gently used” materials for new. Good luck! And make sure to get that foundation checked out!
this one sounds like to much money being put in for a rehab home. it might be alright to do for a rental, but if ARV is only $55k, you wont make any money off of it. And actually you could lose money after you figure realtor fees.
Thanks for the replies. I had the property professionally inspected. I’m looking to rehab and then hold as a rental property. Here’s what I’ve got so far after the inspection.
Electrical - Inspector said it doesn’t need a complete rewiring, but he estimates about $2000 on this one.
Roof - Estimated between $2500-$3500.
Exterior and Interior Painting - Father in law is a painting contractor and has agreed to do the work with my help. Supplies only.
Interior Flooring - I’m probably going to go with a low end laminate. I’m estimating about $2500 for a 1600 sq. ft. house.
Kitchen Cabinets - Probably around $1500 for cabinets and countertops.
The rear bathroom had significant deflection in the floor and exterior joists. Sub-floor also needs to be replaced. It needs to be rebuilt and re-piered. Luckily it’s a very small room (no more than 50sq feet). Inspector estimated $1500, but I wonder if it won’t be higher.
As I said I plan on renting the house for a good while so with a purchase price of $22,500 and $10,000-$15,000 in repairs it should provide a nice cash flow since it should rent out at $650-700/month. Let me know if anyone sees anything out of line with my estimates.
well, i guess if you have $40,000 in total costs and $400 per year in taxes and insurance and get $650-$700, you’ll cash flow about $350-$400 per month, not including management fees, vacancy factor and maintanence expenses. It looks like a winner from the info you provided…KD can nail it down for you.
Yeah, my plan is to spend roughly $35,000-$40,000 in purchase and rehab costs. This would be all cash. Then, refinance for 30 years (possibily pulling some cash on the refinance) and hold the property as a rental for 5-8 years. Hope this plan works.