Are you looking to get into the business of remodeling and building multifamily housing? If so, here are a few things you can expect along the way.
Multifamily renovation projects are usually done in order to increase a property’s value. However, the process of development can be tricky waters to navigate. In this article, you will find information that will help guide you through the process. Starting with:
What is multifamily housing?
A multifamily home is a residential property that contains more than one unit, such as:
Townhouse – In a townhouse, two families will live in a building separated by a single wall. Each unit will have its own private entrance.
Semi-detached housing – This type of housing is similar to a townhouse where there are separate living quarters but share a common wall.
Duplex – This is housing that has an upper and lower level; both are equipped with private living spaces.
Apartment complex – This single structure includes at least five separate housing units. Residents may have shared common areas, such as a pool/pool house, parking structure, playground, and dog park.
What is involved in a multifamily renovation?
- Updating lighting.
- New roofing.
- Redesigning unit layouts.
- New flooring.
- Updated kitchen cabinets.
- Electrical rewiring.
- Building additions in storage rooms, bathrooms, and staff areas.
How much will a renovation cost?
The price of a proper renovation will depend on the housing size. On average, the cost may range between $10 and $60 per square foot. This is a good starting point to keep in mind when you are planning your multifamily renovation budget. However, it is recommended to anticipate a higher cost. Hiring professionals to get the job done correctly will get the job done right, but it will not be free. However, it is definitely worth every penny.
What is a multifamily value-add model?
This is a strategy that is used in order to raise rent prices after renovations are completed significantly. Upgrades and additions to the units will increase the value of the building, which means you are offering more to current residents or prospective residents.
What about renovation premiums?
This agreement between you and your lender covers the amount of time required to pay off expenses associated with the renovation. Knowing your premium costs will help you meet anticipated ROI goals.
Do multifamily properties appreciate?
Multifamily buildings do appreciate in value after they have been renovated. In addition, upgrades will attract modern renters by providing the living situation they need.
Once you have started your renovations, you’ll find that there are six stages that you go through from start to finish:
- Strategizing – Having a solid plan, down to the very last detail, will be essential throughout the entire renovation process.
- Financing – The accurate and realistic knowledge of your budget is key. Do some research before you choose a lender.
- Outsourcing – In this stage, you’ll need to find the right contractors for your project.
- Demolition – For this, you’ll want a clear idea of what needs to be removed or broken down, such as drywall, structure breakdown, and the removal of old appliances.
- Construction – This is the fun stage. Now your renovation plans start to fall into place.
- Beautification – Also known as the clean-up phase. Here is where you add the finishing touches to make the property visually appealing.
Another important part of renovating your property is to consider your current residents. If you have people living in your building, you have to consider whether daily work will disrupt them. There are ways to make sure your current residents don’t feel like they are being inconvenienced.
- Take a survey before you start and ask them what they feel would improve the building, such as what type of amenities they would like to have access to.
- Be honest and open about when contractors will be working in the building. This will alert them to the chance of hearing loud noises.
- Explain to your current residents how they will benefit from renovations.
- If you are renovating common areas, you’ll want to emphasize the importance of proper safety.
Next, you should consider how renovations affect your property’s curb appeal. Giving the outside of your home some love as part of your project will boost the property’s overall value. Curb appeal renovations can include:
- New windows, shutters, doors, and entry systems.
- New roofing.
- Landscaping.
- Walkways and ramps.
- Paint.
What are some of the takeaways we’ve discussed about multifamily renovations?
- Improvements will increase your building’s overall value.
- Although renovation will vary in cost, having a plan for your budget before you start will let you know what can and can’t be done throughout the process.
- Renovations have six stages: planning, financing, contracting, demolition, construction, and beautification.
- Do your research before you hire a contractor.
- Make the happiness of your current residents a top priority.
- Remember, renovations can be made inside and outside your building.
With these words of renovation wisdom, you can now start your project knowing what to expect during the process.
Need additional reasons for reconstructing a multifamily home? Well, you’re in luck.
Be sure to take great caution when starting a reconstruction project. You should always consider if your plans will lead to consumer satisfaction. For example, a duplex housing project is going to be a more economically friendly project compared to full-scale apartment buildings.
When doing research for your project, you should keep in mind that people searching for places to live will consider a few things, such as space, amenities (washroom, multiple bathrooms), kitchen layout, and storage space.
Here is one last parting shot before you go forth and tackle your multifamily renovation plans… giving your building a facelift should be fun. Start with only good intentions and end with updated living quarters that people will love to live in.
If you are looking for more information to help you start your renovation project, contact Superior Commercial Solutions today. We offer the best professional solutions and guarantee that you will receive spectacular service.