Where to make updates?

[Lukas Ku]

Hi, I've been a lurker for a while but just created an account for some specific questions. I just bought my first house. I'm handy and my intention is to live in it for a few years while I fix it up and then turn it into a rental. It is currently a 1bed/1bath house plus 2 very small rooms (8'x6.5' and 12'x6.5'). The existing bathroom could use an update. I'm young and not married, I have some money saved up but not unlimited. I'm wondering where to spend my money and time to get the most out of it. Located in Spokane, WA in a nice neighborhood.

Possible Updates:

1. add ~4' to the 12'x6.5' room to make it 12'x~10.5'. I would get a contractor to do this. This would be the most expensive update but adding a bedroom seems like it would be the biggest increase in rent right?

2. Move the washer and dryer out of the 8'x6.5' room to create a "half bedroom". A twin bed fits in there nicely and its a decent layout with a closet and a window but it is SMALL. Could I even count this as a bedroom when listing it?

3. Move the washer and dryer out of the 8'x6.5' and turn it into a half or full bath.

4. Update existing bathroom.

5. Update electric. The house is old with old electrical. The electrical said its not that safe right now with a fuse box (vs a breaker box) and grounds being grounded incorrectly. The entire update would be $4500. I feel like I should do this but kinda hard since it doesn't add a whole lot of value as a rental.

In an ideal world I would probably do all these updates but money and time is limited. Which updates do you think I would "get the most bang for my buck"? Which updates would you do if you were me? I'd be doing all the updates myself except the bedroom addition. Thanks for any input/tips!

[Jonathan McKay]

Some thoughts based on my experience in Spokane: 

1. Sounds expensive, but will probably add $200-300 in rent for Spokane market. 

2. I'm a little skeptical of this. We tried making a small bedroom out of a floor plan in the Valley that would have been large for a 1bd 1ba, and that unit has turned into one of our most difficult to rent. 

3. This can probably get you an additional $1-200 in rent. There are very few 2bd 2ba apartments / houses available, so I'm not sure how much that would add tbh. 

5. Sounds like there are things you need to update (grounded incorrectly) and things to monitor (fuse box) that could wait for a full update. Often insurance will come do an inspection and they won't insure the property if it is actively unsafe so you'd be forced to fix it.