All Forum Posts by: Derek Lukas

@Chris B., Thank you for sharing your insights. Interestingly enough, two of my bids were from Handymen. One of the Handymen quoted this job at $20k. The other handyman is actually a licensed plumber that does plumbing work for a local HVAC company full time. Do you have any tips for finding qualified handymen or tradesmen, other than hanging out at the Home Depot or a construction site for a few hours and asking folks if they have an interest in side jobs? Perhaps you have a few references that you would be willing to share?

I have a small 9 unit apartment community that I am helping to manage. We are currently looking for a contractor or subs that can complete an interior remodel on one of the vacant 1 bedroom 1 bath units that measures 412 sq ft. I have received four bids for this work that range anywhere from $14k to 25k. All but the highest bid are from unlicensed contractors. Is this expected pricing for the Tucson, AZ area? 

The scope of work is inclusive of only a handful of materials (leveling compound, bonding agent, cement board, vapor barrier, tape, red guard, grout, thinset, sheetrock, firring strips, mud, fasteners, old work boxes, light switches, duplex receptacles, and cover plates) and all labor. Major items in the renovation include:

• Level floors, Lay new peel and stick vinyl throughout
• Remove wall heater from bedroom
• Re-sheetrock in living room to smooth out wall (tie control thermostat wires in wall to provide power on roof)
• Install new plumbing runs throughout
• Install new drain lines where applicable
• Install water line and in-wall box for refrigerator ice maker
• Install new tub
• Install new tile shower surround
• Move over all light switches away from door trim
• Run wire to two new living room lights, install three way switch outside of bedroom and exterior patio door
• Install new light and wall switch in bedroom closet
• Move bedroom door 6-7 inches to the south to allow construction of half wall
• Demo existing living room closet and construct half wall (replumb gas and electrical as required)
• Demo kitchen cabinets, pantry and counter
• Install sheet-rock over water damaged hardboard in bathroom and bedrooms
• Interior Paint throughout
• Install new bathroom vanity
• Install new bathroom light
• Install new kitchen light
• Install new cabinets
• Install new granite counter tops
• Install new AC registers (bedroom and bathroom)
• Install new toilet
• Install three (3) new six-panel doors (bedroom, closet, bathroom)
• Install new outlets and covers
• Install new switches and covers

Again, my four estimates for this work range from $14,000 to 25,000 and would complete in 2-3 weeks. The owner will be providing the majority of materials estimated at $4,800 (cabinets, vanities, mirror, light fixtures, faucets, toilet, flooring, baseboards, tub, tile for shower surround, vanities, pre-hung and slab doors, door trim, granite, under mount sink, etc). 

This means that labor pricing is anywhere from $44 to 61 per square foot for almost a full renovation, sans re-running electrical and tearing all walls down to the studs. Another way to look at this is on a per hour basis... 240 to 300 man hours of work, so $47 to $83 per hour. Isn't this crazy?? What is everyone else paying for their jobs?

@Jerry Hill, your comment is exactly what I worry about. Yes the kwikset smartkey makes it easy for a Landlord or Property Manager to change the lock, but it also does so for the Resident. If the Resident does change the key out, it doesn't look like there is an easy solution for the Owner or PM to get back in, short of drilling out the lock. Take a look at this video from kwikset, demonstrating how difficult/impossible it is for veteran locksmiths to enter:  

https://www.youtube.com/watch?v=RWCmEvp4zq0&feature=youtu.be

Michael- as Mike M. advised, this property is likely in a very undesirable area given the price point while also considering that the rehab is also rolled in.  

I have started to become more involved as a private money financer of several notes myself and am in the Tucson market. The generic information you provided just isn't enough to provide more of a detailed answer over and above what others have already mentioned. That being said however, your buddy may have just come across a smoking deal with a very low basis. The potential equity in the deal it's what would protect your investment capital and ensure a faster sale to the takeout buyer, assuming it is priced correctly after completing the rehab. What is the ARV? What side of town is it in?

As I read searching through Tucson Contractors on BP (looking for a good GC, handyman,  painter and Mason currently) I came across this post and figured I should close the loop.  I ended up using Scott Guerin heading and cooling.  They completed two Evap cooler/ furnace to gas pack conversions (2.5T ea) for me at $7000. I found them to be very reasonably priced compared to many others I quoted. They are responsive and returned 3 months after the completed job due to one of the systems not working (did not charge for this repair). They did leave quite a bit of trash behind and on the roof,  but I deginitely plan to use them again. 

@Mike Sanford, Thank you for the referral Mike. I found Arizona Mission Heating & Cooling – (520)822-8499, hopefully this looks right. 

I'll give them a call. 

Any others that are investor friendly?

Does anyone have any positive experiences with a good HVAC contractor in the Tucson, AZ area? Who can you recommend for either new installations or repairs/maintenance?

Does any one know a good HVAC contractor that is reputable and would charge a fair/good price for a roof mounted 3 ton AC unit in east Bakersfield?

I did not bid on this parcel, but I was interested in learning from it. Oddly enough, the sale was cancelled by the county after the successful bidder had won it for $103,000, when ARV for the entire building structure is ~$260,000!!! I had reached out to the title company that insured title on the latest sale for the property (it was listed on the MLS and advertised as a fourplex) and they had no idea about the issue. After looking into it, I wonder if the title company was able to somehow get the sale thrown out?

Okay, so here is what I was able to find out while researching title: the property was most recently deeded to another investor in 2011 but the legal description omitted the neighboring parcel! Because of this, the original owner is still on title for the tax defaulted property, hence why it is up for auction. Does this error become reconciled with the title company that provided the title search and title insurance? Where does this leave the investor that purchases the tax defaulted property?

Additionally, the parcel that is up for auction lists the use code as

0200 - DUPLEX OR 2 LIV UN 1 PARCEL

Whereas the neighboring parcel's use code is

0400 - FOURPLEX OR 4 LIV UN ON 1 PARC

and the trustee deed lists a four unit multifamily as a rider on the mortgage documentation.

Any ideas?