Business

Scope of Rehabilitation Work: Understanding Costs

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Repairs are a wild card in the rehab process, and you need to be as precise as possible to give yourself the best chance at maximum profits. For each property, you will need to decide the level of work you want to do on the house. Use the following categories, listed below from cheapest to most expensive. I did not include the costs, because they depend on your area. For example, a basic rehab may cost $10 per square foot in Ohio, but $100 per square foot in California.

Basic Rehabilitation: Requires the least amount of work necessary to get the house in delivery condition. For a basic rehab, you’ll do a full house and lot cleaning, painting and carpeting. Work goes fast and the house is usually sold to a retail buyer for a low price, or to an investor looking for a rental property.

Standard Rehab – This is the most common project you will undertake. Make sure that any work you do for a standard rehab is consistent with the neighborhood standard.

Remodeling: This is a standard rehab on steroids. In a remodeling project, you are replacing and improving the entire house. You may also be removing walls and expanding spaces. You may even decide to make changes to the layout by adding rooms, increasing the size of the rooms, or moving the bathrooms, etc. This represents the greatest amount of work, the greatest risk, and potentially the greatest reward.

So how do you determine a quick job estimate? While he was in his office, he should have done some number calculations based on the information he got from any research he’s already done on the property and the neighborhood. The numbers will change, but you need a place to start.

To determine the cost of repairs after the tour, you have two options;

Bring your contractor to the appointment to get an estimate for the repairs. The benefit to you is accuracy. The drawback is that it is expensive and it can take a few days to complete the work estimate. When building a relationship with a contractor, they will want a fee for their time. Later, after you’ve established a track record, most contractors will waive the fee because you’ve proven yourself and want to keep your crews working.

Your second option is to do the calculations and estimates yourself. If time is of the essence, you can even calculate the numbers on your car with your calculator. You have other appointments to see and projects to manage. You have a couple of options here. The first is to use an online software program that will quickly generate an estimate, based on the cost of materials and labor in your area (eg, HammerPoint Project Estimator on OpenRoad). The second is to use some generalities based on what you know is needed to rehab a kitchen, bathroom, etc. You can also use square footage to determine costs, which will require a bit of pricing research. To shorten the learning curve, network with other rehabbers in your area to see what type of rehab they typically do and what their cost per square foot is.

Keep in mind that you could have three contractors come to the property and provide you with three very different job estimates. So while a contractor’s estimate improves your odds of getting an accurate figure, it’s not foolproof. The key is to get a number that is close. You can have your contractor inspect the house later to adjust the numbers. Just be sure to leave a clause in the contract that gives you some protection in case a major repair that you missed suddenly shows up.

Hidden Cost Factoring

Beginning rehabbers using the bidding formula I’ve recommended often make the mistake of believing that repairs are the only significant costs. Not so. The bid formula is useful for generating a quick number that puts the investor in the best position, in case the project hits some hurdles or takes longer than anticipated. In essence, you’ll always generate a lower bid than might be necessary, but you’ll find that you’ll need the extra padding.

Additional costs to be aware of include:

Purchase Costs – Every time you buy real estate, you incur costs associated with transferring ownership. This includes title insurance, transfer fees, inspection and appraisal; however, it does not include the cost of money used to make the purchase. Often these fees will be paid by the seller, but it is a good idea to “Pay All Seller Closing Costs” as a way to provide additional value to the homeowner. Typically, this equates to 1.5% of the purchase price.

· Maintenance costs: some properties will sell faster than others. You never want to get stuck in a position where you didn’t account for the possibility that your home will take longer than expected to sell. Holding costs include property taxes, insurance, utilities, and any maintenance costs. You can also have an association if the property in question is part of a homeowners association. To determine a rough estimate of what your maintenance costs will be, multiply 1.5% by the purchase price.

· Cost of money: Unless you have considerable savings, you will need borrowed funds for the purchase and rehabilitation of the property. Consider the following questions:

or How much money do I need?

or How long do I need it?

o What interest and installments will I have to pay?

Sale Expenses: These are the expenses incurred when putting the house on the market and selling it:

o Realtors commissions (typically 6% of the sales price, with 3% for the listing agent and 3% for the buyer’s agent)

o Closing costs (generally 1.5% of sales price)

Depending on the volume of properties you want to rehab and sell per year, you may decide to sell the home on your own or enlist the help of an agent. If your business is churning out rehab after rehab, you’ll want to spend your time managing projects, researching leads, and filling your pipeline; therefore using an agent is probably best. However, if your business is small, perhaps only rehabbing one home per quarter, you may prefer to sell the home yourself and save yourself the cost of paying the commission.

Again, the formula I recommend will put you in the best position to make an offer that will protect you in case something goes wrong. At some point early in the process, you’ll want to take a closer look at the costs of the project. This means getting a more accurate repair number from your contractor, plus including the additional costs described above.

Home Kitchen

What is the best vacuum cleaner for your individual needs?

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There is no better vacuum cleaner for all circumstances. To say that it exists would be like saying that everyone should drive a certain luxury sedan or small economy car. Someone who needs to transport 6 children does not need the same vehicle as someone who transports 4×8 drywall. My needs and yours may not be the same. Some people just want to clean rugs and rugs, others have bare floors, and some people want to vacuum drapes and wood trim, which we call “above-floor cleaning.” Some of the newer frize and shag rugs are too long for many vacuums and some of the newer high thread count rugs (such as Dupont Silk and Shaw Caress) are very soft and comfortable to walk on, but very difficult for most to push on. of vacuum cleaners. Some people have dust allergies and need superior filtration. Some people need a vacuum that is light enough to go up and down stairs, others need one that is very easy to push. At Byers Vacuum, we spend time asking questions before recommending a particular vacuum. Here are some of the questions to ask yourself: What surfaces do you want to clean? If carpets, how long? Open floor? Above the floor? Do you have fringed rugs? Carpeted stairs? Does anyone in the household have dust allergies? Are you picking up long hair that gets tangled around the brush? How many hours per year will it be used? How many years do you want it to last? Do you want to buy American? Most vacuums, including Hoover, Eureka, Dirt Devil, Bissell, and Dyson, are made in China, South Korea, Malaysia, or Mexico. If you have the answers to these questions, you’re ready to determine which vacuum is “best” for you.

A straight suction bowl is good for bare and above ground floors. A bowl with a power nozzle allows you to clean carpets as well. Some power nozzles will adjust in height for new friezes and fluffs, some will not. The same goes for studs – some will adjust in height for wainscoting and fluff, some won’t. New extra soft mats need the ability to reduce suction (one company drilled a bunch of holes in their nozzle to bleed off suction). And some studs have attachments that work well for above ground cleaning, but some have none or don’t work very well. Most studs can’t shut off the brush separately from the motor, but some can. This feature allows you to vacuum a bare floor without spreading dirt everywhere. Also, if you have fringed rugs or fragile antique rugs, you may want to be able to turn the brush off. Most containers with electric nozzles allow you to turn the brush off. On studs that can turn the brush off, some do it with a lever on the nozzle, others have 2 motors with a switch right on the handle that allows you to turn the brush motor on and off with the flick of a finger, rather than bending over , much more convenient when fringes are made.

Some studs, like Orecks and SupraLites, are very light. This makes them very easy to transport from one level to another or to transport them from one place to another in a cleaning business. Other machines, like the newer Kirbys and some older Hoovers, are truly self-propelled, where they have a transmission that runs the vacuum both forward and backward as you push and pull the handle. These can be operated with one finger, but are heavy for going up and down stairs.

Of course, aside from making sure the vacuum will work on the surfaces you need to clean, some vacuums filter better than others. Do not assume that all “HEPA” filters are the same. In Europe, a product that claims HEPA must meet the standard. In the US, you can put a filter that HEPA tested at 10 CFM in a vacuum that draws air at 90 CFM and blow dirt through the filter. Or a vacuum may have let air out other holes so it bypasses the filter, but still claims to have a HEPA filter. From what I’ve read of people who have tested vacuums with a laser particle counter (if you have severe allergies to dust, you’ll want it tested to 0.3 microns or less), Miele and Nilfisk have the best filtration. However, a test with imitation bags and filters in a Miele reported measurable dust emission. So it’s not just about the vacuum being well sealed and packed, but also about the quality of the bags and filters. A typical micro-lined bag will trap most dirt down to 5 microns, but it’s not just the bag or filter you need to worry about. Bagless machines tend to leak a lot more dust (despite their “HEPA” filters, or cyclonic technology), plus you spread a lot of dust when you empty the bin. Even if you don’t have dust allergies, if you compare the cost of bags to the cost of filters for most bagless vacuums, you may find that the bagged vacuum is cheaper and less messy. Replacing a bag usually takes less than a minute and the result is a brand new primary filter without having to wash and wait for bagless filters to dry which can take up to a day. In my opinion, the best thing about a bagless bag is that you can see the earth spin.

Some vacuums have rotating metal brushes with slide-in replaceable bristles, which is cheaper in heavy use and much more durable around long hair. Plastic brushes can melt if the hair stands up at the ends. Some are better protected from hair than others. Another thing to look out for is plastic shafts, rather than metal ones. These wear out quickly and the wheel falls off. Some vacuum cleaners are much more durable than others. Some are more comfortable to wear for different people. The only way to know for sure is to try them. My recommendation is to buy a vacuum from a local vacuum store that services what they sell, can show you the differences in quality, allows you to test the vacuum on different surfaces, and will allow you to return it if it doesn’t work well on your carpet. . If you have problem carpet, such as lint, or soft new carpets, bring a spare piece to test the vacuums, so you can see how easily each type of vacuum will work on your carpet. They can advise you on the durability of different machines, as well as the availability of parts.

Some chain store vacuums come with longer than average warranties, but there may not be anyone in your market to repair them (Dyson and Shark come to mind). So I advise checking to see if a machine can be repaired locally, under warranty or after, before you buy. You can find many brands that can be serviced, but not under warranty, in your market. And some may not be useful at all.

In conclusion, you can see that there is no “best” vacuum cleaner for everyone. And a number of brands can meet your needs. Personally, I like Riccar’s onboard tool uprights and their lightweight uprights as well, but for bins, I prefer Miele’s German-made models. German Sebos are also very friendly. And if you live in a city where the only brand you can repair is a vacuum, you should probably try to find the best vacuum for your needs, even though they are now owned by the Chinese and no longer made in the USA. (Since I originally wrote this, Hoover has gotten to the point where they don’t offer many parts for machines, especially if they’re older than 2-3 years, so this advice may not be as valid as it once was.) If you’re just starting out, live in a small apartment, have no allergies, no kids, and no pets, a cheap outlet store model might be quite suitable. It’s amazing how much longer a vacuum lasts if you only have 500 square feet of carpet to clean, instead of 3,000.