Reno on IP units - feedback needed

2 of my IP units are about to come off their tenancy lease and I'm thinking of doing some reno to them. I've not done an apartment reno before and given I've to work full-time, I'll have to let someone manage the whole reno project. Would appreciate some feedback on the propose reno for the 2 IPs.

Apartment 1:

• 2x1x1 unit in 1970-80s condition. Basically everything is old and falling apart.
• Currently rented out at $440pw (self managed) and PM thinks after reno can fetch between $600 to $650.
• Been given a rough quote yesterday:
  • $13k-$16k for the bathroom
  • $13k-$15k for the kitchen including basic appliances
  • $3k-$7k for painting, repainting some built-in cupboards and doors
  • $7k-$9k for dropped ceiling
  • still waiting for cost of timber flooring, electrical work, new blinds and built-in wardrobes

Questions:

1. Total cost seems to be $50k or more. Is the quote fair for the amount of work?
2. Given that we are likely to lease the unit out again after reno, should we go with a cheap kitchen (e.g flat pack from Ikea or Bunnings) instead?
3. Any ideas what work can be held off to cut cost without significantly impacting the rental? I was thinking maybe forgo the dropped ceiling and do it later.
4. Any other feedback & ideas is very much appreciated

Apartment 2:

• 3x2x1 unit in fairly good condition except both bathrooms are very old but still usable condition.

Question:

• How much more better rent can be fetched by putting in new bathrooms? Is it worth renovating both bathrooms?

Thank you.

 

You could get the costs of the bathroom and kitchen down but given the rent it gets now and the future amount seems like a premium type area and may command those amounts to be spent. The ceiling likely not a huge value add

Best to get on re.com.au and check out comparable renovated units in your block/area

 

Yep, did that with Apartment 1. One of the unit upstairs was done up and rented out for $650pw. Mine being 1 level lower, may fetch less.

 

@pwt I did exactly that.
1. Do the drop ceiling especially if it's the rubbish textured stuff. It makes your place feel bigger. For that money you should get it with shadow line and the lining 13mm sound check. If you want save cash as its rental use 10mm lining.
2. Allow for down lights.
3. Keep a custom kitchen. A poly one with stone tops will be 10k.
4. Remember to get a depreciation report done.
5. Bathrooms. Keep plumbing in same spot if possible. Use ceramic wall tiles .
6. Make it a place where people walk in and want it. Remember it's +10k a year and depreciation, when done.
7. Make sure you use the correct underlay for the hard surface.for both reflected and transmitted noise.
Remember to factor in holding cost and opportunity cost in your calculation.

 

Thanks @Gingin for the feedback. Good reminder on depreciation as well. So you think $50k works sounds fair?

Would a laminate floor works better than timber flooring, assuming strata is ok with it?

 

Those renovation costs look more akin to a house not a 2brm unit. I'd be looking to spend about half as much on a unit - $25K.

 

I agree with Prop - that sounds way over the top. Get more quotes.

 

Wouldn't dropping the ceiling decrease the feeling of space?

 

50k sounds expensive to me. But I diy so have no idea what people are charging for this stuff.

 

Agree, I thought it was expensive too but another place I checked was quoting $10k to $15k for small budget bathroom reno.

A friend of mine had his ceiling lowered over 4 to 5 years ago and cost them $6k.

Does anyone recommend Bunnings or Ikea kitchen packages?

 

Just received an sms from my current tenant for Apartment 1. He and his family still likes to stay on and offered to pay $550pw. They are great tenants, pay on time and look after the place well.

Still deciding whether to do a cheaper reno first and accept their offer, or do everything and get a higher rent.

 

100 bucks extra for doing nothing. ... they answered it for you.
You may be able to do some work with them in it. Or see if they are open to renos and the likely increase

 

Ha, I wished. The tenants will pay extra $100pw after the reno. Still below market rates.

 

Isn't it currently rented for 440? And they're offering 550
Post reno would be 600-650

 

Devil is in the detail. Revise scope and pay 25k won't be getting a custom kitchen, shadow line drop ceiling and bathroom Reno to what a $200 / week increase would expect. Let alone the holding , opportunity cost of the project. Love it when people don't account for their own valuable time and overheads.

Surprisingly no. Especially when covering a textured ceiling.

 

I dropped the ceiling when I plastered a few of my rooms. But they are raked ceilings rising to 3 metres so 60mm lower was fine.

But best to replace rather than drop the ceilings on any rooms that are closer to 2.4m high.

You don't want to inadvertently end up with technically 'non habitable' rooms due to ceiling height being outside NCC requirements.

 

@bob shovel Just to clarify, the current tenant offered to move out during reno and moved back in after. Offer was to pay $110pw more, but it's still well below market rates.

Have used hipages to get additional quotes, let's see what comes back.

 

I have used service seeker with varying success. Is a good format. Need to find the good ones in the sea of battlers talking up a good game in a high demand market .

Also, Don't pay cash. It'll sort out the clowns out there who are in for the ride.

 

Ive had a bit of a look on air tasker and wouldn't use it for decent sized reno's. Seems like it's for handy man work at most. Unemployed unskilled peeps looking for cash is the feel i got! And people that don't want to much!
Get the local paper and find reno companies. Id love to do it for you, sounds like a good reno

 

Got a few responses from hipages with 1 being a member of Masters Builders Association. I've only used hipages once for pest control but neighbour used it to get some roofing and tiling work done. He was pretty happy with it. But agree, definitely have to becareful.

@bob shovel, you'll spend more time stuck in traffic driving from Penrith to the site