Major Costs Of Rehabs?
What are the major components of a rehab that really do cost a lot? I know there must be things that seem to cost a lot to do and many contractors trump up the price due to that, so what are the things in a rehab that DO cost a lot, and what are the things that seem to cost a bunch but really are cheap(er).
I do understand that a whole bunch of little things do add up. I'm just trying to get a basic guideline for what costs a lot and what shouldn't. Esspecially if I do some of it myself.
Thanx.
Here's one:
New roof.
I just had a new roof (30 yr., architectural) put on one of my rehabs. Now, roofs are always a major expense, but this roof already had 3 layers, and shingle layer removal is time consuming and therefore expensive.
Total cost: $8600 for about 1300 sq ft. (including ice dams and new plywood in some areas)
I got four estimates, which ranged from $7K all the way up to $15K (Ouch!). I wound up using a roofer I've used before on my own home.
He wasn't the cheapest, but his work is good and his work ethic is even better.
Happy Rehabbing.
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Take a look at this thread...
http://www.thecreativeinvestor.com/ViewTopic39654-20-4.html
JohnMichael provided a great overview of cost ranges for different aspects of rehab.
Quote:
On 2005-01-01 04:58, Joe_Oh wrote:
What are the major components of a rehab that really do cost a lot? I know there must be things that seem to cost a lot to do and many contractors trump up the price due to that, so what are the things in a rehab that DO cost a lot, and what are the things that seem to cost a bunch but really are cheap(er).
I do understand that a whole bunch of little things do add up. I'm just trying to get a basic guideline for what costs a lot and what shouldn't. Esspecially if I do some of it myself.
Thanx.
Each rehab is unique and variables are many to answer this question, however some of the major items will be:
HVAC
Windows
Electrical
Roofing (can be if removing asbestos)
Kitchen / bathroom remodels
New exterior veneers
foundation problems
Contractors earn their money by providing a service, they offer;
1) knowledge and experience that can save you money
2) organizational skill and understanding how the trades are to flow in order to complete the project.
3) providing his workers / subcontractors that are good at what they do and dependant upon the GC for their livlihood.....therefore their goal is to make him happy.
Many rehabs do not need GC's on the job, however the greater the project and more liability their is.......it is best to bring one in.
If you plan on doing rehabbing for the long haul, it would be best to find a good GC or subs that you can develop a working relationship with.
NC_Yank
Don't overlook the cost of 1) permits, 2) additional insurance, and 3) demolition debris hauling.
permits may include building permits, and street opening permits needed to upgrade water, sewer, or gas lines...
debris hauling may include dumpsters which can cost thousands of dollars
Surprises are the biggest cost.
Realize the costs vary widely for any trade/job. Ergo, costs are all relative to YOUR location, and to the relationships you cultivate with good help.
The above mentioned roof is <$4000 where I am.
Dumpsters are $300, not thousands here.
But like everywhere else, it is difficult to find dependable skilled help first time out.
Do your research where you are to pin down local costs.
If you try too hard to be safe, and estimate your rehab costs too high, you will not make the deal because you will not see the profit potential.
If you underestimate, you will miss your projections, i.e., lose money.
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Kitchen Cabinets are very expensive even for cheap ones.
Siding can be very expensive. but watch out, We had a salesman come to our house once (oops) and in the 4 HOURS he was there the siding bid went from over $9000 down to about $2800. So make sure you get other bids.
Hauling debris can be very expensive, I just bought a lot that I knew was pretty bad but I had no idea. there is now a hole about 140' X 30' X 5' deep . That used to be full of trash. It was like relocating a landfill. there were hundreds of tires, metal scrap, wood, plastic, and on and on. It cost over $11,000 to clean it up. Heavy Equipment is VERY expensive to use..
Good luck.
Josh
This sounds pretty good so far, and getting multiple bids on a project is a must from what I hear.
The only thing I see being a real pain is getting the permits and having to deal with city/township ordinances.
Appreciate the input, Thanx!
Permits are not necessarily that big an issue, IF IF IF you have competent help pulling their own permits.
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I agree with Mike . Other than making a mistake when you buy the biggest cost is a surprise, like an apartment we almost bought that we found at the last minute had asbestos in it where it was going to have to be removed. Or some environmental issue, these things can cost alot.
George