I have a small house in town that I’ve been using as a rental for the last 5 years. It has supported itself plus over these last 5 years. Real estate prices have gone crazy, and with 10 years left on the mortgage I’m thinking of selling. My idea behind have the rental was it would be paid off when I retire, giving me a handy source of income in my retirement. And if I get to a point where living on my farm is no longer feasible, I’d have a paid-off home in town to move to.
However. At this point I’d make almost as much in income off the equity balance as I would with the rental, without the hassle. So, strongly considering selling out and banking the money. I don’t need the money now, but I think the real estate bubble will burst and I’d rather sell on the right side.
So, the house is a small (1050 sq ft) 2 bedroom/one bath home on a good-sized lot. There is a 3rd small room (about 8X12) that’s used as an office but has a washer/dryer connection in there. Would it be better to keep it as is, with the office, or spend the $$ to convert the office to a master bath? Since there are plumbing connections there, it wouldn’t be undoable, but probably not cheap to convert it. But 2 bed/2 bath is more marketable. I could put some of that money into upgrading the kitchen, which will need some cosmetic makeover any way.
Tell us more about the layout. Is the laundry room on the main floor, on a back porch, or in a basement? Where would you move the washer/dryer if you convert that room? Are you thinking bathroom with a tub, or a shower?
What do you think is the maximum you could get for the house if you upgraded everything vs. what you could get right now if you upgraded nothing?
I would treat it like a fix and flip. No big changes focus on cheap and easy cosmetic changes.
Here is a quick list that looks about right from the flippers I know.
Basically paint everything, and clean everything. Replace countertops with granite and upgrade appliances, sinks, faucets and hardware in stainless steel. If its needed add in new carpet and other updated flooring.
Yeah, if you’re looking for a quick easy sale, this is the plan. Once you start changing rooms around, you never know where it will end, you might discover something that screws up your plans, ending up costing you more.
Keep everything structural, but upgrade the cosmetic bits. New counters and cabinets are pretty quick to install and don’t cost that much, compared to what they add to the sale value.
Check the local market at Realtor.com for the 2/1 single family homes. Look at Solds and listings for an idea of price points keeping in mind location, lot size, garages, porches, the yard, schools etc. You can always vastly improve an interior with the ideas listed above. But old doesn’t always mean replace either.
This place looks good, 38 days on market it’s under contract.
[2/1 on 2 acres](Take a look at this home I found on Realtor.com 3806 Woodbury Pike, Murfreesboro $236,000 · 2beds · 1baths https://apps.realtor.com/mUAZ/cdbe7b8c)
The house is one-story. The office was probably at some point a covered porch, but it’s fully converted with heat and air and a door. I’ve drawn up a rough floorplan in OpenOffice Excel, but I have to figure out how to post a link.
Chela - that’s right across the road from the barn I take riding lessons at!
ETA: I understand the economics of putting less into upgrades than I would get out. I’m in no real hurry to sell, and could hold on to it indefinitely, or rent it out tomorrow. The last time I rented it, I put the ad on Zillow at midnight and had 15 requests to view it by 8:00 am.
If it’s feasible and relatively easy, maybe put a 1/2 bath in there, just a WC really, if it leaves enough space for the rest of the room to serve some purpose. Even with just 2 bedrooms, folks generally appreciate another toilet. Otherwise, if it were me I would just sell it with cosmetic upgrades, as everyone seems to be suggesting.
I have a cleaning crew scheduled for Wednesday. Will get an estimate to repaint this week. Kitchen is tiny, so new cupboards will replace the original post-war wooden cupboards that have been painted 20 times.
In this market a scrupulously clean, freshly painted house with some upgrades and no defects will not last if priced right. You May even receive offers over list price. Could sell it before broadcast aka off market too. Take your time!
Many moons ago I went in with a friend of mine that flips houses. He did the bare minimum. He didn’t fix anything that wasn’t a safety hazard or cosmetic.
Sorry to leave you all hanging. I had a realtor in after the cleaner was done. With a short punch list of to-do items, he says I could turn it over probably within a week or two for $219K. I’m looking at that and seeing about $30K in capital gains taxes. I’d still have the mortgage, but that’s mostly principal, so I’d just be increasing my equity.But still a hefty profit for me. Or I could move in for a couple years, then sell it and not pay the tax. There was a WSJ article just a couple days ago highlighting my county as one of the fastest-growing exurbs in the country. I don’t see that dying off any time soon.
So many variables. I’m fortunate that I don’t need the money and don’t have to make a fast decision.
