How much should I budget for total gut rehab?

Land & New Construction
4yFollow

How much should I budget for total gut rehab?

Michael Fitzgibbon
Rental Property Investor · St. Louis, MO · Member since 2021 · 8 posts · 11 votes

Is $85k too much or too little to budget for a complete gut rehab for a $969 square foot, 1 story, signal family in St. Louis area? Roof, foundation, and all brick are good structure good. However, pretty much everything else needs renovation or completely replaced. Removed all interior studs and reframing out two bedroom/two bath. Needs new electric, plumbing, HVAC, and windows.

3Reply
144 views

Most Popular Reply

Zachary Inman
Specialist · Indianapolis, IN · Member since 2021 · 312 posts · 282 votes
4y

Take whatever you have... and add 10k haha. There are always latent issues. 

9Reply
See this reply in the discussion

38 Replies

Jump to latestLatest
  • Curtis Mears
    Property Manager · Raleigh, NC · Member since 2014 · 729 posts · 596 votes
    4y

    @Michael Fitzgibbon

    Be careful with hourly quote. I had similar deal with contractor. They worked 1 day with 3 workers and got very little done. The next day, I left and when i came back, 6 workers lounging about. When I asked what the workers were doing, they said, picking up stuff. Mind you, the entire job was reroofing a small 19' by 10' deck. Paying hourly gived them a green light to cheat you with little recourse for you.

    1Reply
  • Chuck Webb
    Houston, TX · Member since 2011 · 118 posts · 70 votes
    4y
    Quote from @Curtis Mears:

    @Michael Fitzgibbon

    Be careful with hourly quote. I had similar deal with contractor. They worked 1 day with 3 workers and got very little done. The next day, I left and when i came back, 6 workers lounging about. When I asked what the workers were doing, they said, picking up stuff. Mind you, the entire job was reroofing a small 19' by 10' deck. Paying hourly gived them a green light to cheat you with little recourse for you.


    Never pay subs upfront unless you are giving them money for materials. Even then, I pay for the materials then have them do a pickup.  Only pay them when the job is done and you have inspected their work.  Paying them by the hour is a recipe for disaster.  I always pay my subs right after they finish the job.  It keeps them coming back to me when I have another job.  So many investors out their "stiff" their subs in order squeeze a little more equity out of the deal.  Trust me, word gets around, and before you know it you will be unable to find anyone to work for you unless you pay in full...then they will rip you off.

    1Reply
  • Ryan HalfordPro Member
    Real Estate Agent · Tampa, FL · Member since 2018 · 65 posts · 31 votes
    4y
    Quote from @Bruce Woodruff:

    @Michael Fitzgibbon This is from the St Louis website: 

    All contractors and sub contractors performing work or services within the City of St. Louis are required to obtain a graduated business license for contractors pursuant to Ordinance 61094 (Section 8.12A of the Revised City Code - 1992

    If you choose to work with an unlicensed guy to save a few bucks then that is on you. But don't you kinda wonder why he never bothered to get licensed? There is always a reason....

    I guess there is a small chance that he is legit and on the up-and-up but why not just hire a real Contr.....?

    And no, you're still not going to get a house a stud-down remodel for $85k - Electric/plumbing/framing/Insulation/drywall/floor/paint/kitchen/baths/fixtures/exterior/etc....?


     Keep in mind, while your contractor should have a business license, a business license is not a contractor's license. I cannot speak to St. Louis but many localities do not offer a GC license but may have individual trades licensed. I know for example in Illinois that you can be "licensed/insured/bonded" as a GC and not have any kind of training or certification whatsoever. For me, the most important thing is that they have workman's comp and general liability insurance so you don't end up being liable for them if they are injured or if they burn down your property. 

    [email protected]813-670-7070
    0Reply
  • Eliott Elias
    Investor · Austin, TX · Member since 2021 · 9k+ posts · 5k+ votes
    4y

    I'm not a contractor or familiar with the St Louis market but that sounds like a pretty conservative budget considering a 969 sqft property. It also depends on what you actually want to do with the rehab. Are you looking to have a full luxury remodel with top finishes or make it just rentable? 

    0Reply
  • Derek DeVerna
    Real Estate Broker · Toledo, OH · Member since 2019 · 55 posts · 73 votes
    4y

    @Michael Fitzgibbon

    Add 25% to your rehab budget for your first 5 projects and then drop that amount down to 20% after those are complete.

    3Reply
  • Andrew FribergPro Member
    Rental Property Investor · Montesano, WA · Member since 2017 · 14 posts · 38 votes
    4y

    I just recently did a 1600sqft full gut remodel, (still finishing it up) and it ran me about 80k in a cheaper market. so I think as long as you are keeping your contractors honest, 85k should be enough. it might be wise to expect 10k over for misc. ex. at the end for unexpecteds and punchlist/inspection items

    P.S. I am a contractor tha hires other contractors to work on my flips so I have a pretty good understanding of costs for work.

    0Reply
  • Jonathan KlemmBusiness Member
    Moderator
    Contractor · Chicago, IL · Member since 2016 · 4k+ posts · 2k+ votes
    4y

    Hey @Michael Fitzgibbon - That honestly does not sound too far off especially given how fast all materials are going up.  Maybe you can structure the deal with some incentives to finish early.

    I know up here in Chicago we would be between $75-95/SF.  The big factor is going to be finishes which can take your budget way up or down.

    [email protected]
    Quality Builders4.966 Reviews
    WebsiteView Page
    1Reply
  • Crystal SmithPro Member
    Moderator
    Real Estate Broker · Chicago, IL · Member since 2014 · 2k+ posts · 1k+ votes
    4y
    Quote from @Michael Fitzgibbon:

    Is $85k too much or too little to budget for a complete gut rehab for a $969 square foot, 1 story, signal family in St. Louis area? Roof, foundation, and all brick are good structure good. However, pretty much everything else needs renovation or completely replaced. Removed all interior studs and reframing out two bedroom/two bath. Needs new electric, plumbing, HVAC, and windows.



    Normally I'd say $85K is just about right for a small home like that in St. Louis but.....  Check on lumber prices in the area. The cost for framing may drive the number higher. Also 
    312-681-7487
    0Reply
  • Kyle Eckert
    Realtor · Saint Louis, MO · Member since 2017 · 228 posts · 174 votes
    4y

    @Michael Fitzgibbon

    When ballparking a building for a gut rehab, we use $100/sqft to eyeball it, so 85k for your rehab may be a bit light, but not by too much.

    Then, if the numbers still work we go through and line by line the repairs needed.  Bringing in plumbers is usually the biggest cost, followed by HVAC if ductwork is needed.

    1Reply
  • Bruce WoodruffPro Member
    Contractor/Investor/Consultant · San Diego / Phoenix · Member since 2021 · 12k+ posts · 15k+ votes
    4y
    Quote from @Kyle Eckert:

    @Michael Fitzgibbon

    When ballparking a building for a gut rehab, we use $100/sqft to eyeball it, so 85k for your rehab may be a bit light, but not by too much.

    Then, if the numbers still work we go through and line by line the repairs needed.  Bringing in plumbers is usually the biggest cost, followed by HVAC if ductwork is needed.


    Don't forget the electrical. A complete rewire including a new panel and mast can run $25k...That's why I think his number is too light. If you end up with $25k each for Electrical/Plumbing/HVAC, that's $75k right there....and that is easily possible...

    0Reply
  • Bud Gaffney
    Rental Property Investor · Boston, MA · Member since 2019 · 2k+ posts · 1k+ votes
    4y

    I think it's just about right!

    0Reply
  • Aaron J Latal
    St. Louis, MO · Member since 2018 · 52 posts · 19 votes
    4y

    I think like some have mentioned above 85k is probably close. If you do higher end finishes you might end up closer to 95k, I would definitely make sure you have 25% in reserves like was mentioned above. If you need a GC in STL I might be able to connect you, not sure if those I know are taking on new jobs like that right now. 

    0Reply
  • Wale LawalBusiness Member
    Real Estate Broker · Houston | Dallas | Austin, TX · Member since 2018 · 5k+ posts · 2k+ votes
    4y

    This is a tough question as it will depend on the quality of the finishes and other expenses. 

    [email protected]832-776-9582Podcast Guest on Show #469
    NETWORTH BUILDERS5236 Reviews
    WebsiteView Page
    0Reply
Join the conversationCreate a free account to reply, vote on answers and follow this thread.
Log InJoin for Free