rehab costs creeping up

[James H.]

Hey Guys,

I recently bought a new rental property and am in the process of rehabbing it to rent it. Generally, I buy the lowest cost of whatever-it-is that I am replacing so long as it is durable. However, As I go through the house and become more familiar with it, I find more nit picky things that I just can't leave alone. Mechanical stuff is the main culprit. It seams this house has a leaky valve where ever there is one present and gas lines are piped in copper in some places!

But these are the big ticket items that I have (80 percent decided) on doing:

Central HVAC ($3,000)

Upgrade electric service ($1,000)

Replace 60 year old wall oven and cook top ($? new or good used)

Move dryer connection and install stackables to make more useable space in kitchen ($500)

Fresh light fixtures, switches and plugs throughout - old ones are only two prong.($300)

Miscellaneous - this is the one that gets me. There is a miscellaneous of like $100 to every $400 I do no matter how thoroughly I estimate ahead of time, or so if feels like it.

Paint in and out ($1,000)

So far I have gutted the bath room, installed new subfloor,underlayment and tile, sheetrock and FRP throughout, new toilet and sink vanity and shower plumbing, and purchased all the vinyl tile for the kitchen as well ($2,000 including $300 dumpster rental for garage demo).

I just can't leave this stuff alone as I do not want to crawl under the house again, or at least not any time too soon. I have the floor up in part of the kitchen and have easy (as easy as it can be) access to the crawl space. In the mean time, it is taking more time to do the work and costing more money up front. The house is 2 bdr and I only paid 12K for it. I am looking at about 8K with the HVAC, and add the kitchen appliances onto that.

I just don't feel right renting the house to someone else if I don't have a sound mind that these mechanical things are going to be reliable. I am midway though the project (labor not money) and am kind of freaking out about the money (although I am still in budget, it hurts to come out of pocket nonetheless)and I think I just need some positive words of wisdom, affirmation if deserving and general encouragement. Its my first deal. I am planning to put on market for $650/month. This is about 50/month above market for the neighborhood, but I know the house will be in better condition when I am done. Although I am doing the improvements to reduce future maintenance, it will be in better repair than most of the houses in the immediate area - so I think I can get a little higher rent - especially when it is looking all fresh.

[Account Closed]

2 prong outlets mean the wire isn't grounded... Putting 3 prong outlets won't automatically ground the wire either... Youd have to rewire or protect the circuits with GFIs. in my experience tenants won't notice and pay more for rewire, new mechanicals, or a new subfloor. I think these are important items to take care of, but will go unnoticed. Newer appliances, new floors and paint are what keeps my apartments above market rate.