Reno with tenant

Would really like to reno one of my properties and get a refi after, however there is one little problem: there is 9 months left on lease with a great tenant who i would love to stay on!!!

Anyone conducted a reno with tenant living there? Did you give any types of incentive (ie. reduced/waived rent, putting them up in hotel etc). Do you think it is fair?

Just to clarify I was only planning on doing pretty unobtrusive things during the day whilst she is at work, including:

* Plaster bare besser brick internal wall in the hall entrance
* Knock out internal bathroom wall enclosing toilet
* Light reconditioning of bathroom tiles fittings, new vanity
* paint of kitchen, bathroom, hallway walls...
* New down lights in hallway, kitchen, bathroom
* new gutters, and maybe roof (based on feedback from other owner in block)

* Maybe, based on potential disruption: Polishing of floors in hallway (would need to be left without walking over night etc)...

Any thoughts/feedback would be great!!!
 
When I paint a tenants house,I always give them a free weeks rent,Never had a problem,however I am always out before the weeks end.
Try not to let it drag on,remember you are using their privacy and their power.:p
 
thanks for the response - yeah totally agree/understand that you are really putting them out and your are at their whim!!!

So, when you paint - do you move all furniture out of the room first, paint, then move back, or just move it all into the center and cover???

Are we entitled as owners to do maintainance? Do you phrase it as a question or as a demand as landlord???
 
Everybody moves the furniture in the middle of the room and that really pisses me off.
It stays where it is and you take pictures off walls and things off tops of cupboards that can fall.
Put drop sheets on the floor and plastic sheets on the other furniture.
This is so you can see what is underneath.

Paint the ceilings first,apply two coats.
Then paint all walls that don't have anything in front of them,finish them off with the second coat..
Then you can move other stuff in front of the finished walls.(Take a photo so you know where everything goes)Paint those walls twice.Put furniture back.the only thing left will be the gloss work,no furniture will be in front of them,so go for it.
You haven t even upset the tenant yet.:D
 
/waived rent

Yes. At the very least.

Good grief. :eek:

Doing a reno on one's own home is totally disruptive, but at least you get the financial benefit.

It's pretty mindboggling that a LL would even consider doing a reno in a tenanted house.
 
Yeah point taken Amadio - Just to be clear i never planned on wanting to paint bedrooms... Was hoping to only paint hallway/entrance, bathroom, kitchen, storage and maybe lounge depending on the tenants feelings... Other renos will be contained to the bathroom/hall/outside, and easily contained to be done during the tenant is at work etc.

Am very aware of this disruption, and if I was in her shoes i would want 100% rent discount and full hotel subsidy, if i was talked into accepting in the first place - which i probably wouldnt be!!!

Having said that, I think the reno will open up alot of equity in the place, so I think it is worth trying to see if i can proceed and was just trying to work out the best approach/rights/feasability!!!
 
easily contained to be done during the tenant is at work etc.
This is where you could de-rail. Reno's never seem to go as planned. If she comes home and finds you still there because you couldn't quite finish something in time, it will be seriously bad.

You are wanting to be in her space for your personal financial gain. I know it's hard to get your head around it when you are a LL , but you have given over the property to her in exchange for money. To have the LL in the tenant's living space every day, even when the tenant is at work, is still an invasion of privacy.
 
Did it ones many years ago and have never done it again.

As mentioned, things never go according to plan and with the tenant breathing down your neck things are even less likely to go according to plan.

The painting would be the one and only thing that you could tackle on the inside and even then you are doing yourself a disservice as their condition report will not reflect the mid occupancy paint.

On the outside the guttering should be fine as you can come and go at will.

My advice is wait until the property is vacant and then see how you go achieving all these jobs. My bet is it will take 4 X as long as you planned and that will be with an empty property.

Cheers
 
Yeah point taken Amadio - Just to be clear i never planned on wanting to paint bedrooms... Was hoping to only paint hallway/entrance, bathroom, kitchen, storage and maybe lounge depending on the tenants feelings... Other renos will be contained to the bathroom/hall/outside, and easily contained to be done during the tenant is at work etc.

Maybe you don't tell her you are the owner,just a handyman doing the painting for the owner?
 
We try to do things between tenants, but we did have a builder add a huge back deck whilst tenants were in. I think from memory we reduced the rent by $30 a week but they were happy because they gained an extra living area. The builder did most of the work outside and broke through the living room wall right at the end, so disruption was minimised.

Yesterday and today, hubby and I helped my brother paint four rooms in a house that will be photographed for sale tomorrow. My brother knows I have done my share of painting, but he wanted to do this job as a lead from a local agent who will recommend him for more gardening and general maintenance work. (I know painting is NOT gardening, but it is a long story.....)

Four of us painted four rooms (walls only - lots of windows) in four hours and we went back today for two hours (three of us) to recoat one room. Two rooms were VJ and two plaster, so much quicker than the VJ!!

The owner was very happy with the job, but it felt quite strange to be painting a house that we don't have a financial interest in. I kept thinking "best not drip the paint or make a mess".
 
Just a bit of a follow up on this thread:

Had convo with Tenant yesterday, as I was hoping to do some work on this place next weekend.

Started off talking about 1 day of work only extending to outside of the property (new gutters, painting, new gate, tidy up etc). She was very happy for me to do this, and excited about the improvements to the property. She engaged me well and even suggested paints/colours etc etc...

I then took this as a good indicator, and asked if she would be happy for me to do some improvements to the inside of the house over the next two days. I said i would like to plaster wall, new lighting, fittings in bathroom/kitchen, painting in hall, new vanity in bathroom.

She thought this would be great, and mentioned it would make the entrance hall much more inviting and welcoming. She was very happy for me to come in an do this work.

She then mentioned that her daughter's bedroom is close to the bathroom, so be careful of creating to much dust. At this point, I offered to pay for her and her daughter to go away to a nice BnB for the night. She was estactic. She has been emailing me with contacts to help the reno (i am from outta town) and is very excited about the new improvements to the place.

All in all a good result for all. I get to do all the work I wanted, and tenant is 100% happy :)
 
Better than the last place I was renting when the landlord wanted to reno.

The kitchen in that house was awful and the bathroom was perfectly functional. He wanted to re-do the bathroom, no compensation, just "you won't be able to use the bathroom for X weeks, and then the rent goes up $50pw".

I broke the lease and left.
 
Just a bit of a follow up on this thread:

Had convo with Tenant yesterday, as I was hoping to do some work on this place next weekend.

Started off talking about 1 day of work only extending to outside of the property (new gutters, painting, new gate, tidy up etc). She was very happy for me to do this, and excited about the improvements to the property. She engaged me well and even suggested paints/colours etc etc...

I then took this as a good indicator, and asked if she would be happy for me to do some improvements to the inside of the house over the next two days. I said i would like to plaster wall, new lighting, fittings in bathroom/kitchen, painting in hall, new vanity in bathroom.

She thought this would be great, and mentioned it would make the entrance hall much more inviting and welcoming. She was very happy for me to come in an do this work.

She then mentioned that her daughter's bedroom is close to the bathroom, so be careful of creating to much dust. At this point, I offered to pay for her and her daughter to go away to a nice BnB for the night. She was estactic. She has been emailing me with contacts to help the reno (i am from outta town) and is very excited about the new improvements to the place.

All in all a good result for all. I get to do all the work I wanted, and tenant is 100% happy :)

Sounds like she wanted more than your renovation skills. Did you manage to get it all fixed up in the time they were away?
 
ROFL - it may sound that way, however my GF may have something to say about that sort of thing haha...

Sry to be confusing, doing the work next weekend - just gave an update after actually speaking with the Tenant.

BTW - Rumpledelf, the reason why i treaded carefully is legally the tenant can refuse access to property for renovations. I would have told the Landlord to go F*%& himself!!! God people like this make my blood boil!!!
 
Naturally assuming your personal time over the coming weeks / months is worth nothing jacbmw, how much do you reckon you'll be able to increase the valuation by, over and above the cost of the improvements ??

Why aren't you chasing extra cashflow ??

------------

He wanted to re-do the bathroom, no compensation, just "you won't be able to use the bathroom for X weeks, and then the rent goes up $50pw".

coupled with

the tenant can refuse access to property for renovations. I would have told the Landlord to go F*%& himself!!! God people like this make my blood boil

Do you really think that is an appropriate response to RE's circumstances ?? Are you really a Landlord ??
 
Dazz- even though the original scope of this thread was very specific, I will indulge:

Profit:

* Yeah not much, actual increase - approx. $5k over costs i would say
* This will be stage one, in turning this older unit into a potential executive short term renter in the future, as it is less than 10 min walk to CBD. Got to step up the presentation though to achieve this.
* By conducting a 'renovation', I will be able to convince the bank to perform a reval. less than 4 months after the last. So would the market have moved in this time I hear you ask??? Well technically no, not really, but I have very strong suspicions the bank undervalued this property when i refinanced it across to them in January. They may have done this to lower their risk with a new customer. I have since got two more loans with them, and am very happy with the valuations i have received. The market moved 41% in the last 12 months, and a decent amount since Jan. regardless (West Hobart Unit Market btw).
* I am gearing up for a large purchase in the next 4 weeks, I am really trying to find reasons to get as much $$ in the bank as possible. The smallest profit for these types of projects, will have a huge multiplying factor when re-invested into my upcoming project.
* I think some facets of this reno will be intangible, and really add to the impression as the Valuer walks through the door - lets see!

Time Value:
* As long as it is not every weekend, My partner and I actually really enjoy this type of reno.
* We will be spending time with family and friends in our home town whilst we are there
* Get to do some renovations with my Dad and brother
* All in all, cant actually wait to get down there and do these renovations :)

Landlords acting morally:
* Dont condone a LL being a bully or an ****.
* To clarify, 'Bully's' make my blood boil, not landlords :)
* I would have told him to go F*%& himself - NOTE: the word 'I'. As a tenant in that relationship, 'I' would have probably done a little more than just saying it haha :)

Anyway mate, I have a huge amount of respect for you, how you go about business, what you have achieved. You are certainly a role model for me, and I have modelled my plan for the next few years to a reasonable (and pretty substantial) degree on your Commercial pursuits.

This thread however was only related to a very specific topic. It is at risk of derailment. I have my motives, I have done the figures, I value my time (that is all I value actually), and I am a landlord :)
 
Thanks for the detailed answer jacbmw. I cannot see the business justification as yet for what you are proposing, but it appears to be driven by something else other than money.

Maybe 5K profit, assuming your time / effort / risk is all worth nothing seems to be very thin indeed.

I don't agree with your assertion that the thread is being derailed because I asked questions about the underlying purpose of your proposed reno.....after all, this was your first line in the original post....

Would really like to reno one of my properties and get a refi after


Good luck and have fun with your endeavours nevertheless.
 
Personally I'd only reno *between* tenants. I'm likely to rent out my current house late this year or early next, it could use a new bathroom at some point (existing bathroom is functional but ugly and cramped), no way we'd do that with someone in the house.

In my little situation, the landlord just happened to be doing something unnecessary and extremely disruptive right when I was at a point of being able to buy a house myself, so there was zero incentive to stick around and put up with crap. The house had just sold - he was a brand new landlord, probably just getting carried away playing with his new toy, but no less irritating when you're the tenant. A little politeness, negotiation and compensation would have gone a LONG way and I might have stayed on and just bought an IP or something rather than a PPoR.
 
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