Should I Add A Full Bath to A Rehab Flip?

[Moshe Eisenberg]

Hey Guys,

I just went into contract on a rehab deal in Jersey City. It's a SFH. 3 Bed, 1.5 bath. The basic #s are 100k purchase price. Renovating cost around 35k. I can sell it for 175k.

The broker suggested I add a full bath on the main floor to increase the value of the house. I would love to hear anyone's opinion on this. 

I will tell you now what I'm thinking of doing to determine if it will be worth it. I am planing to get a BPO from an amazing broker I've been dealing with. (Needless to say my BPO guy isn't vested in the deal so he has no reason to "adjust" the value..) I will have him tell me how much more I can get for a 2.5 bath over a 1.5 bath. I will get an estimate from my contractor on cost to add the full bath. If the value goes up significantly more than the cost I will prob go for it. 

Any advice is greatly appreciated!

[Crystal Smith]

@Moshe Eisenberg I would ask your broker to provide a sales comparable report for everything that's sold within the last 6 months up to one mile from your property.  Have him run the report on all 3+ bedrooms w/ 1 bath.  Then run the report with 3+ bedrooms w/ 2 baths.  All the properties should be about the same size as yours & within no more than one mile away.  Look for a significant difference in the sale prices and Days on Market.  If the difference in price is much larger than the cost to install a new bathroom & they are selling faster then put in the bathroom.