All Forum Posts by: June Veenstra

Kurt, I appreciate the calculation you sent me.  It makes a lot of sense and clarifies it succinctly.  Thank you.  If I can spend less on the renovations than the return on my money will be even more so conservatively renovating makes the most sense.  

Kurt K.   

I'll be doing both kinds of renovations you mentioned and thanks for clarifying the differences.  

Thank you everyone for the good ideas.  The catch-22 is I need to spend at least $ 8000.00 in order to increase a 400.00 a month rent to 650.00 a rent, or 50% increase from the last registered rent.  Painting does not count, but refinishing floors might.  

 I would love to give you his name but I have so much work for him at this time that I'm not willing to give up his name just yet.  Ask me in a few months.

Natural wood is nice but just not really in now.  The black painted cabinets look very modern and are definitely trendy.  Styles change but if you keep it classic and the colors look good together it can still work.  Recently, we put a new tile floor with an oak kitchen that really made it seem more modern.  The tile were large rectangular shapes in a medium gray to look like slate.  It looked great with the oak cabinets.  If you put new hardware, countertops and perhaps a tile backsplash, wood can still look great.

I'm finding that most of the cost is in the labor and not the materials so if I want it to last getting better quality materials is the way to go.  You can get porcelain tile that is strong, durable and attractive but you need to shop around to avoid the ugly stuff.  When trying to decide what to do for my units I look at zillow or the other apt. rental websites to see what other units look like and how much they rent for.  I try to stay competitive and provide a similar product for less cost.  That way my units will be desirable.  I also try to make them look attractive.  I try to emulate the high end apartment but make it affordable by recreating a similar look for less.  I also don't install particle board products if I can get plywood for the same money.  The only place I might use particle board would be in the bathroom because if it's cheap enough it will be easy to replace later if I have to.

Thanks @CandacePostell.  Actually, you are partly correct.  The reason there are so many vacancies is not because of the location.  The location is great.  The problem is the condition of the apartments and that the previous manager/owner was barely reinvesting in the property.  Some apartments have been sitting vacant for quite some time, while others for less than 1 year.  I think you are right about fixing things properly so there will be less repairs.  In addition, sometimes just having the place look great and be functional without breaking the bank (even though rehab costs are fairly high) will help me get the right tenants who will stay for a long time.  What are the smart ways you have found to spruce up your places?  That would be helpful.  I'm putting in new kitchen cabinets (to replace the old 1950's maple cabinets) and new bathrooms.  Tiled kitchen floor and laminate floors throughout where the old wood floors are damaged.  Also, removing any thing tacky (think old linoleum, rusty radiators, cracked moldings) and making the apartments look classy is my aim.  I think they are coming out great because my contractor is awesome and has wonderful cost saving ideas and his workers do quality work for a fair price. Even the contractor's workers have inquired about renting the apartments when they are done!  So it will be hard to resist not spending as much money on the units where because of rent control I can only charge 600.00 to 700.00 per month.

I own multifamily buildings with a lot of vacancies.  In order to get the vacant apartments back on the market they need extensive renovations.  I've done the calculations and it totally pays to renovate in towns such as North Bergen that will let me increase the rent 50% above the last registered rent (these are rent controlled buildings)if I spend $8000.00.  Where I can't raise the rent I'm thinking it doesn't pay to do expensive rehabs especially where the rents are artificially low.  The low rent property is in Union City.  I'm thinking just spend the minimum amount to get them back on the market .... nothing fancy.  I'm thinking that if the rents are way below $1000 per month than keep the apartment basic... nothing new if possible.... just clean, repair what's necessary and make it functional.  Where the rent is above 1000.00 a month I might pop a new kitchen or bath in because I will make back the investment in a year.  Thoughts?

I have since learned that I only need to hold onto the properties for 5 years as the tax consequences when converting from C corps to S corps has changed.  This offers much more flexibility.  My first goals will be in rehabbing the properties, fixing what is not up to code and then getting vacant apartments in rentable condition.  Hoping to improve the value of my properties.  Further down the road I might want to sell utilizing the 1031 exchange or leverage into other properties.  There is one property that has the potential for a lease-hold arrangement.  Does anyone currently have a lease with a commercial tenant that could share information with me?

Hi,

I'm a newbie from Wayne, NJ..

I am soon to be the owner of several apartment buildings. I am new to management/ownership.  I am eager to learn more on how to maintain my property and maximize my profits.  The building is rental.  I plan on holding on to the property for at least 10 years because of tax consequences if I were to sell.  

Looking forward to finding out more from others in the community.

June