Hi Folks,
Late last year I made a few posts regarding two properties I was purchasing in Queensland. Both bought cheap, but needing some work.
One property in particular was in a very bad way due to the tenants from hell that had damaged most of the internal walls, the kitchen, the bathroom etc.
Both properties were purchased for around$100K and would have been worth about $120K in good condition.
I am pretty handy so I figured I could do the renovations and get some equity in these properties even at these margins. I thought around $10K each to renovate giving me at least $10K equity in each property.
Well, I was wrong.
My wife and I did most of the renovations ourselves with some trades help (but minimal). At the end on the day the cost to renovate blew out and took the final cost of ownership on each property up to the $120K range anyway.
I took two weeks off work, it wasn't enough, and had to extend to four weeks. We worked on the houses for 26 days straight, eight to ten hours a day. (Not to mention the syringes hiding everywhere, the cockroaches, the mess, the damage!!!!!) Nearly ended in divorce, talk about high stress!
We made ziltch - but we learned a hell of a lot about costing (money and time) this sort of project. At this end on the market I should have bought two houses ready to go, or I should have got these houses a lot cheaper.
The worst part was blowing all my rec leave for naught, I do not love my job, and holidays are just too valuable to throw away.
In the final analysis I have two good rentals, returning $165 and $170 per week and a good property manager, at least I didn't throw to much money away. But the reality is that these projects were not worth the work when you look at the immediate return.
Now the funny thing is, I just bought another two properties, and they need some work as well - I must be mad.
Cheers,
Shaun.
Late last year I made a few posts regarding two properties I was purchasing in Queensland. Both bought cheap, but needing some work.
One property in particular was in a very bad way due to the tenants from hell that had damaged most of the internal walls, the kitchen, the bathroom etc.
Both properties were purchased for around$100K and would have been worth about $120K in good condition.
I am pretty handy so I figured I could do the renovations and get some equity in these properties even at these margins. I thought around $10K each to renovate giving me at least $10K equity in each property.
Well, I was wrong.
My wife and I did most of the renovations ourselves with some trades help (but minimal). At the end on the day the cost to renovate blew out and took the final cost of ownership on each property up to the $120K range anyway.
I took two weeks off work, it wasn't enough, and had to extend to four weeks. We worked on the houses for 26 days straight, eight to ten hours a day. (Not to mention the syringes hiding everywhere, the cockroaches, the mess, the damage!!!!!) Nearly ended in divorce, talk about high stress!
We made ziltch - but we learned a hell of a lot about costing (money and time) this sort of project. At this end on the market I should have bought two houses ready to go, or I should have got these houses a lot cheaper.
The worst part was blowing all my rec leave for naught, I do not love my job, and holidays are just too valuable to throw away.
In the final analysis I have two good rentals, returning $165 and $170 per week and a good property manager, at least I didn't throw to much money away. But the reality is that these projects were not worth the work when you look at the immediate return.
Now the funny thing is, I just bought another two properties, and they need some work as well - I must be mad.
Cheers,
Shaun.
