Colorado Walkout Basement House Hack Short Term Rental Tracking

[Dan Mackin]

Just wanted to create a thread where I post updates on our basement apartment that we had built out from an unfinished basement with the full intent of it being a rental from the start. This build was fully laid out to be a higher end rental with minimal concessions made for cost savings and more focus put on comfort both for the tenants and for my family living upstairs. I will post updates as we have them and will attempt to be very transparent with our numbers so others can get a realistic view of what a project like this may involve and our specific lessons so far. 

Here is the basic timeline:

- Purchased property in late 2019 for $490,000

- Property was a 2 story 4 bed/2.5 bath house with a full unfinished walkout basement

- Premium for the property compared to one without the walkout was somewhere around $30-40,000

- Basement was around 1200sqft unfinished space and the apartment was best setup to be around 800sqft

- Started initial framing in early 2020, but COVID put a stop to some plans due to cash reserves becoming more important

- Project was on hold until late 2021 when framing resumed (all framing was done by me)

- Jan 2022 had a tankless water heater installed (had 20 year old tank already and don't want to run out of hot water with tenants) $3500

- Jan 2022 had main electrical panel upgraded to 200A setup and also had 100A sub panel installed in basement and charger for car in garage $6000

- Feb 2022 finished 95% of framing and GC began plumbing work

- Feb 2022 HVAC work began (We installed a fully separate Mini Split Heat Pump for the unit) $5,400 for all fans and mini split install

- March 2022 Electrical Rough In was completed

- March 2022 Rear Door (Entrance) was swapped from a small slider to a full 36" exterior door

- March 2022 Passed rough inspections and given the go ahead for drywall

- Late March 2022 Drywall install completed

- Walls are standard 1/2" single sheet

- Ceilings were done in the following order for sound insulation (Fiberglass batting, resilient channel, 5/8" drywall, Green Glue, 5/8" drywall) $7500

- April 2022 Primed all walls and ceiling

- April 2022 Carpet and Vinyl flooring installed

- April 2022 Trim installed

- April 2022 Kitchen cabinets installed

- Mid April 2022 Interior doors arrived and were installed

- Mid April 2022 Shower pan was built out

- Mid April 2022 Butcherblock counters cut and fitted with sink and oiled

- Mid April 2022 Puck lighting installed

- Late April 2022 Appliances arrived

- Late April 2022 Painting continues (biggest regret here was not hiring a painter. Anyone can paint, but pros are so much more efficient)

- Early May 2022 Backsplash installed

- Early May 2022 Shower tile installed and fixtures fitted

- Mid May 2022 furnishings and finish items begin arriving

- Mid May 2022 Couch arrives after 8 weeks of waiting and proceeds to not fit through the door. Window has to come out to get it in while it's snowing

- June 2022 Shower glass finally arrives

- June 2022 Project Finalized and ready to post

- July 2022 Listed on VRBO

That's all for today. I'll begin doing the monthly update posts shortly to show our numbers and also do a full breakdown of project costs and things we like and what we would change as well.

[Dan Mackin]

Now I'll start posting my monthly #s. These will be somewhat basics and do not take into account full utilities (since this is at my primary it's hard to fully calculate it all), but does cover cleanings, fees and supplies.

August 2022 Stats:

- 18 booked nights across 4 bookings

- No guest complaints and all 5 star reviews

- Gross income of $2,707

- Net income after cleanings and fees/taxes of $1953.69

- We found a great cleaner who actually lives on our street. She already cleans units like this for some other people so this was right up her alley. Due to this we are able to remove our buffer between stays now which will allow more booked days each month. We're going to make sure to treat her well.

- As for noise or anything else we occasionally hear a door shut since they are solid wood doors and not hollow, but really haven't been disturbed by it at all. No voices or TV noises have come through so the sound deadening has done its job.

- Posting only on VRBO for at least the 1st year as a test of demand on that platform and to see how the numbers sustain. AirBnB is still the more popular platform for our area, but I'm testing out how being a big fish in a small pond works vs the opposite. 

- We are not using a pricing platform to start since our market here isn't that large anyways. In August we were set at $120 a night and a $150 cleaning fee. 3 guests did get the initial 20% discount.