Sweat Equity on a MFH

[Brody Veilleux]

What type of renovations are best on a house hack if the goal is to BRRRR every year? I know the typical value add on a SFH is to fix up kitchens and bathrooms, and forced appreciation with ADU's or new bathrooms and bedrooms, but how can you do this in a MFH? I can't imagine an ADU would be very beneficial, and most dont have a basement to convert into more bed/baths. I can't see how to BRRRR effectively with these properties.

[Bryan Maddex]

FYI, ADUs will NOT pay for themselves on appraisals. if you are in an area without many ADUs, you may get $5-$15k as a value, even if you spent $100k on it. If you have a TON of ADUs in your area, you might get 50% of the cost to reflect in an appraisal. 

Appraisals use GLA or Gross Living Area, that is your main house. Anything not actually apart of your main house (or a basement that is below grade) is considered Additional Square Footage and will have a fraction of the value per sqft as compared to GLA. 

ADUs can be a great investment for the ROI, but not for BRRRRing as you spend a lot and cannot recoup most in an appraisal.