The Numbers On My First Contractor Rehab

When I bought my first deal I inherited all my tenants and knew there was going to be a lot of work that needed to be done. As tenants started trickling out I'd go in and upgrade the floors, counter tops and paint, while trying to keep the cabinets, showers, etc. the same. 

When my most recent tenants moved out I planned to do what I had been - floors, paint and find a new tenant. This unit was a totally different beast. The tenants had been in the unit for 5 years and left it trashed. Like a lot of trash. I filled a 12 yard trash bin with trash. One of the showers was disgusting - see above!

​It looked like I was going to have to redo the bathrooms. I can't just paint, do the floors and leave one bathroom all gross. This meant I was going to hire my first contractor and handle a full rehab and this is how it turned out!

The property is in a C location, which is a fancy way of saying that it's in a working class neighborhood with older homes. I have a hard knowing what are necessary upgrades for that area while still trying to salvage what I can. I was saving over 75% with my house hack  and budget but I also replaced 3 HVAC systems on top of these rehabs and it was all getting expensive! 

​My network of other real estate investors that I can lean on isn't the best which meant I started my search for a contractor the same place as everything else, Google. 

I looked for positive reviews and eventually had 3 people come out. One person gave me an estimate but it was slow and communication was slower. The second group didn't give me an estimate and never responded to any communication. The last person I spoke to said his company had a 3 month waitlist away but he flips houses on the side and he has a crew that may be able to help.

I had no idea what to expect price wise for a job like this. I knew how much floors and paint would cost but this was something totally different. I knew it was going to be expensive but I was a little shocked when the first estimate came back over $27,000 (which included materials). That's twice what I paid to even buy the place!  If you are interested in what that estimate looked like here it is. Prices may be different in your area but I would have found seeing this stuff super helpful. 

After seeing that I reached out to guy that flips houses. He said he thought his guy could do each bathroom for $2500- $2800 so I figured it wouldn't hurt. Honestly I was just hoping it'd be cheaper than this!

​He gave me a rough verbal quote of about $8,000 in labor and I would need to purchase and provide materials through out the process. I was a little hesitant on why it was so much cheaper but was fine purchasing the materials since I was trying to get my Southwest Companion pass and I needed the spending!

I double checked previous work that had been completed and it looked nice. He said I was able to pay him as work was completed so at this price I figured I would give it a shot!

​I did run into a hiccup and needed all my pipes replaced which changed my price a little bit. I did replace some windows prior to him coming to do the work and his demo wasn't apart of his estimate. Here are the final numbers for what it cost me to complete the full rehab.

Summary
This experience was a really good learning experience for me. I had no idea what the cost of a rehab this size would be or how the little things like outlets and hinges add up! I learned that when you are responsible for providing the materials it is a lot of running around to get bathtubs, finishing nails, outlet covers, and so much more.

This experience was a nice transition into working with contractors, seeing what things cost when you don't do it yourself, and will come in handy when I try to BRRRR in the future.  

​If you want to see what all this money bought me I have a before and after video here.