Rehab Cost


#1

Something I learned from Scott and Tony on CRE that has really paid off for us is to rehab our units to meet or exceed our tenants expectations not ours. The biggest key I learned was that paint is cheap and will fix most anything… I see a lot of people spending money on things that don’t matter a whole lot and wanted to share some photo’s of something that come up in a chat about the value of painting a unit.

Here are the before pics of a unit that we inherited in one of our parks. Words and pictures don’t do justice to just how bad this home was… to instill a mental picture the brownish stains on the carpet are the remains of where I had about 4-6" of dog feces shoveled outa the trailer. The floors were bad due to the dog pee and the home reeked with the smell of money!

http://www.picturetrail.com/gallery/view?p=999&gid=12242086&uid=6302593&members=1

The break down of the repairs is as follows:

4 sheets of 3/4 plywood - $80

10 Gal. of Kilz - $110

Wood to fix the Deck - $125

Laminate & Pad bought in bulk - $380

Molding to trim damage to the bottom of the paneling - $65

Sticky Tiles for bath rooms $45

3 windows $110

Carpet for the master bedroom will be around $55

There are some little added cost that I’ve missed and we still have some minor work to finish but that brings the total to $970 for the major stuff. This is not a home I wanted to fix and has taken 2 of us about 30-40 hours total but the home is now Bright, White, and Clean. It smells like new paint instead of money and should rent fairly fast at or above market rate.

http://www.picturetrail.com/gallery/view?p=999&gid=12452270&uid=6302593&members=1

My point is that of all the changes we made to this unit the paint was the cheapest and made the biggest difference. The cost of paint hands down brings in the highest returns IMHO.

As a side note: The picture of the little girl on her new swing set is one of my personal joys, prior to our purchase of this park the tenants rarely came out of their homes and basically hid from each other… what a great feeling it is to make a living helping others!

Best wishes,

Ryan Needler


#2

Ryan,

This is some great info. Thanks for sharing!

Corey


#3

Ryan I agree with your concept. I am rehabbing a small unit in a park I sold to an RTO consumer. We agreed what would be done to make the unit like they want it, and they have signed the contract for 60 months. My total investment so far with a new electical panel and move’n it in and purchase price is about 1500 dollars. The couple has contracted for 60 months for 275 per month. Nice eh? grin If there is a default, we’ll do it again, grin. The lot rent is 75 dollars. Paint did it!!! White sells!!! And down here a peanut color is great. I plan to spend another grand on the unit and that’s all that will be needed to meet their expectations. I have a friend that is a draftsman and draws renderings showing the future potential of each unit I place in a park and rehab, and the consumer interacts with him to show their dreams of the home. The one hundred dollars I spend to furnish this rendering is well spent money for get’n that contract and move in date. grin Thanks for your confirmation of wise investing practices. I try to never forget in this business, I am selling a person a home to live in. A HOME. Home is where the heart is, grin.