Rehab a 70 year old apartment building

[Doug Wang]

I am from Los Angeles and found an apartment building in Fresno.  Escrow closes in two weeks.  The building was build in the 40th and maintained most of its original beauties: red tile roof which is leaking and the roof support shows signs of giving up, original electrical system without ground wires, rotted floor joist, original metal windows.

There are 8 units in the apartment and I paid about $37k per unit.  My renovation budget is about  $13k per unit, which will not cover all problems.  

My question is where I should spend my money?

New roof, rewire, HVAC and then floor and windows? 

[Ryan Gillette]

This is me. I would start with health and safety, and then focus on the updates with the highest ROI. Sister the floor joists, then fix the roof. Have the electrician look at the system - ungrounded isn't ideal, but I would find out if it's truly a safety issue or okay as is. Windows I wouldn't worry about unless there's a safety element to it or they're cosmetically ugly or if you're paying for heat/cooling. If you are paying utilities, then I would look into energy efficient windows - but keep it on the back burner. It'll save you money in the long run, but it's not an immediate project like the other things.

If there's still money left over, then the obvious cosmetic things in the units that are high ROI that you can drive higher rent prices with (or lower vacancy times).