Motel rehab for a first time flip investment?

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@Arisa McRoberts I see that you are in Boise. I'm a builder in Fruitland. On to your question, I feel that a motel rehab into STR, studio or 1 bedroom housing would be a terrible idea. A major rehab that involves non-standard plumbing and electrical work is going to be almost impossible to budget accurately. There is an extreme shortage of plumbers and electricians in the Treasure Valley. Most of them don't like bidding/doing standard remodels/rehab work and your project is different than most.I always tell people when budgeting rehabs/remodels "Take your most accurate money and time budget, multiply the money by two and the time by four". It's very difficult to budget new construction right now. I shudder to think what it would be like to budget for a heavy rehab like a motel.The problem with time overruns on these projects is you typically have borrowed money at interest and little/no income while the rehab is going on. If it takes 6 months longer than projected, you have a major cash flow issue on your hands.

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what is the ARV , then add the rehab cost and see what the rents are in the area , if all the numbers add up , then go for it ! you have to start somewhere and you already have the remodel and junk removal covered , just keep track of all your cost and set the budget once you get the numbers , good luck !

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@Arisa McRoberts 12 room motel, you could turn it back into a motel and run it full time, the isn't a lot of rooms for labor. Depends on the layout, might be able to turn it into 6 2bed apartments and get long term renters..I wouldn't do a single bedroom apt as you probably will not have good tenants.With the uncertainties with construction, supply chain issues, and labor issues, I would say this would be a very risky investment to the unexperienced, and probably not worth the return.I would look at alternative uses if you're still thinking about it. Would it be possible to turn them into small business offices? For small retail stores?

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Arisa,You state that "we would plan to do most of the work ourselves".I would urge you to think about the DIY hours that could be involved here, because 12 hotel rooms is a lot of labor for you and your husband to take on.If the construction cost will be $250,000, I would estimate that there will be approximately 4,000 workhours that will be expended during the renovation. Subtract the hours you expect to sub for mechanical/electrical work. Lets say it ends up being 2000 hours......that's a good pile of hours that you and hubs will be doing yourselves.Divide 2000 by the amount of hours that you will work each week (you/hubs for 8 hours on Saturday = 16), and see how many weeks it will take for the two of you to get the work done. That will make you realize that you will probably be subcontracting the majority of the work, or take forever getting it done, and risking your marriage in the process.If you will be subcontracting most of the work, I would focus on getting as many subcontractor quotes as possible to verify your projected construction costs are accurate.

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ALOT of realtors here in Texas start investing , it's a good hustle , good luck with your first investment .

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I appreciate the feedback! Offices are a great idea too. Its near a main road.

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I appreciate all of the various views! Thank you!

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You said that price is 350k and you are expecting to put in 200k. And it can sell for 600k. That means if you are thinking of flipping it you are aiming to make 50k. Did you calculate closing costs as well as broker fees for selling it ? You would be left with $100 at the end of the day if you manage to stay out of the redadditionally is the property in an area that is an emerging market where you can expect its value to appreciate over time ? Or will it basically just bring in a couple hundered dollars a month after expenses. also you will have a hard time finding financing for such a project bottom line, when calculating the value of an investment you must compare it to other investments. Would this be more profitable the buying a turn-key 4 plex in good areas? doeant look like it to me. Just my opinion. Good luck

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Thank you for your advice!! 😊

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@Arisa McRobertsNot enough meat on the bone for the work involved. Unless you can buy it for 200k. But run your numbers, get some quotes from local people aka electricians, plumbers, gcs and see how it looks. It is all about numbers.