Should I upgrade my garage in my rental property?

Question

Hi everyone,

I currently live in minneapolis MN and my wife and I bought our first duplex back in july.

It has a detached garage. It has a manual door and no electricity.

We are trying to decide if we should upgrade the garage to an automatic door so future tenants can start using it.

For the cost of an electrician and getting all the door upgraded it’s going to cost me around $2400-$2800. Is this worth me doing here in minneapolis?

John Woodrich · Answer

First - this isn't a winter project in MN.  The ground is frozen so it is hard and expensive to dig.

Second - Will you be able to get any additional rent in doing this?  Do similar units with garages rent for a higher price?

I do think that if you spend $2400 to run power to the garage and install an opener (cheap part) that you will get your money out of it in the long run, in most areas.  Whether it makes sense to do it now will depend on the numbers.  If your garage is one of those 1900 garages that looks like it needs a tear down this may just be the start of a $10k garage makeover and that may not make sense.

Bruce Runn · Answer

I have a duplexs in Uptown that I had the double garage with opener and electricity rented for $100/month to people from outside my duplex.  My single garage at the same place with no electricity rented for $75/month.  No investment and still cash flow.  When I rent to a tenant, I charge $50/month since Some people require a garage to rent a property and filling the apt, is the priority.

Filipe Pereira · Answer

Good question. Let's reverse engineer it. How much more could you charge for rent if you had the work done?

Thomas S. · Answer

Decision should be made based on the dollars in the short term. Investments like this need to generate a immediate positive return to capture the expense back in a couple of years. If you make decisions to spend money based on a long term benefit before you know it you are not making any returns for 10 years down the road and may not hold the property that long. Selling will rarely recoup your expenses. Never plan based on long term returns on upgrades as they may not last.

Short term returns should be your primary deciding factor. In this case it is very likely a waste of money.

Nick Danaluk · Answer

It may not be cost-effective in the short run, but will make it easier to resell in the long. FYI, when choosing a garage door opener, buy an Elite Series Liftmaster, either the 8550W or 8550. One is ceiling mounted and one is wall mounted.

In addition to using traditional visor remote controls they can also be monitored via wifi and cellphone app. You can open and close them from anywhere in the world and see their status. They can also be programmed to shut after a certain time period in case you habitually forget to close the door. There is also a simple bypass to keep them open.

The 8550W is a ceiling mount with belt drive making it very quiet. The 8550 mounts on the wall and connects to the roller. Good if you have the minimum wall gap at the shaft. It's only downside is it has a separate automatic lock on the door that makes a popping sound each time it closes.

They are not much more expensive than a chain drive, but a solid upgrade in class and well worth the money. Also use nylon rollers and you have a virtually maintenance free garage door.

Bruce Runn · Answer

@John Woodrich

I put the electrical for garages onto my first floor meter and I pay for electric as I would also have a shared laundry that goes to the 1st floor as well which can not be comingled either.  I essentially charge my 1st floor tenants $50/month more for rent but do not link it to me paying the electric so I essentially get my money back.

Ryan Schroeder · Answer

I'd say if you can get $25/mo more in rent, which is perhaps near a break even over 10 years (depending how you apply your cost of money) I'd do it unless the garage itself is effectively too small to fit most cars or something like that.  Tenants will be much happier, their auto insurance will go down (probably) and it will make your property more marketable to tenants.  A new standard 2 car garage will cost around $20K as a comparison if you contract it out (and you may have site setback issues...your current garage is grandfathered in...a new one has to meet current code)

JD Martin · Answer

You know, most of the time I would say this is a waste of time, but you are in Minnesota and I imagine a garage would be in demand. As said above, how much more rent can you get for an operational garage? That should govern most of your decision.

Kenneth Freire · Answer

Thank you everyone for your responses this def. helped. For now, we decided to wait on it until we have a little bit more cash and people become more reactionary to it.

Thank you @John Woodrich & @Bruce Runn for all your input.

Should I upgrade my garage in my rental property?

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