House hacking and renovations

[Tanner Jenkins]

Hey everyone! I just bought my first house in Charlotte, NC in late August with the intention of doing a little rehab while I live there. It's a 4 bed 3 bath and I currently have one roomate that helps me split the morgatge. I am advertising another one of the rooms and making sure to add all my expenses into the rental cost (property managment, vacancies, repairs, cap ex, etc.).

My plan for this property is to live in for approximately a year while I do the renovations, and then move out when they are complete and rent the house as a whole rather then room by room.

My issue at the moment is whether I should wait to do the bulk of my renovations shortly before I move out or to do them now and be able to advertise my additional room for more until I am ready to move out.

Am I approaching this in the right way, and what other advise do you guys have for me?

[Andrew Powers]

Congrats on the house! How extensive are the renovations required? Maybe you can rennovate the one room, rent it out, then pick at the other renovations over time while roommates are there

[Carlos Paz]

Hey @Tanner Jenkins congrats on the house! If you have the budget to do the renovations upfront, do them now so you can take advantage on the rental income. If not, do them one room at the time. Just curious, why is your strategy to rent the house (once you move out) instead of renting by the room? - you could potentially have more income.

[Tanner Jenkins]

@Andrew Powers thank you! The work is pretty extensive, it involes remodeling the whole kitchen and bottom floor of the house. The rooms have already been renovated so there is not much work to do there. The renovation focuses on the common areas, which are far out of date, and replacing the appliances. Most of which do not work.

[Tanner Jenkins]

@Carlos Paz Thank you! I appreciate the advise! The neighborhood the property is located in is very family friendly. Great neighbors and good schools around, plenty of shopping areas as well. For this reason I think my advertising would be better suited towards a single family. The price that I believe I can reasonably rent to a family with more than one source of income would yeild more cash on cash return then renting rooms out individually, gearing towards people with one source of income. I have found this not only through researching the area but also in my pursuit of attempting to rent out the single room that I currebtly have at the rate I would need to not have a negative or stagnate cash flow. Does that answer your question, and do you believe that is a fair assessment? Is there another way I could be looking at it?

[Carlos Paz]

Thanks @Tanner Jenkins, what I would recommend is to reach out a property management company and see where the rental comp's are for a 4/3 in that neighborhood. That will verify your assessment. I can help you link to one if you need their advise. Hey good luck, this is a great strategy to lower your rental expense or better yet to live for free.

[Tanner Jenkins]

@Carlos Paz I would be grateful for whatever connections you have. Thnk you, I don't know why I did not think of that in the first place!