One of the goals of this blog has been to provide some insight to others on the actual costs to renovating a 100 year old property. In today's post I will be "Showing You the Money". Below I provide an exposed look at where my major expenses have been and what kind of work I was able to get done within my budget.
What does it cost to replace a roof, how about gutting a bathroom, or how much plumbing work can one get done for around $6,000? These are questions that filled my curiosity before starting this project, and might provide useful foresight to others in the budget planning phase. As I've been running through all the projects in my head, I pulled together costs and added a brief summary of the work for all to reference. Since purchasing the investment property for $240K last March, there has been around $87K of renovation costs put into the property. Of this $87K, the project funding has come from a combination of insurance money (roof damage), bank renovation loans (203K Streamline), and cash out of pocket.
Renovation costs have been focused in two main areas: long term infrastructure investments (roof/electrical/plumbing/masonry), and rent generating investments (bathroom/kitchen renovations, light fixtures, appliances, ect). Completing these repairs has has improved the property from a rundown foreclosed building into an income generating 2-flat. With the bleeding of MAJOR project costs slowing, and my tenants now providing a monthly rental income of $1,400/month, the much anticipated start to my ROI has begun.
In my next blog I'll be diving into some of the numbers behind the rental property. We'll discuss cash flow positions and some of the trade offs that went into purchasing this investment property.
