(Homebuying) How Much Renovations Too Much?

[tioga0630]

I didn't know how to title this thread, because there's really much more wrong with the 1832 property than you could fit in a thread title. But we still want the house.

I don't know the exact square footage, but there are ten (small) rooms, so many different kinds of services (oil tanks, two of them, two water heaters...on one water bill, various electrical "patchworks"). I want to use the first floor, which is definitely the nicer one, as a primary residence and continue to rent out the upper to the decent tenants now there.

I know this is asking a lot, but could anyone give me even a ballpark estimate for the following:

1) Cutting through clapboard and ancient planks to install a second, upper stairway (so that the home may qualify for HUD tenant subsidy)?

2) Totally rewiring the home for two services (so that in mid-January, tenants don't plug in space heaters, keep overloading the breakers, and burn the house down)?

3) Tearing down ancient gypsumboard so that the high-ceilinged first floor could be insulated?

4) Replacing 19th/early 20th century NON-WEIGHTED double hung sashes with the cheapest alternative (about fifteen standard-size, @ 3' x 4' (?) windows)?

5) Replacing the @ 3' chimney.

A real estate/home inspector knowledgeable of the home said he did an "APOD" on the home, a former bed-and-breakfast, and that the cash flow was so negative it almost went into the imaginary number system. But I don't want to use the place as a bed-and-breakfast, and if I have a positive cash flow of even $1 a year, that's fine, because I plan to use the place as a primary residence.

Oh well, I suppose you'll make fun. I just need some non-mockery.

[Colbyt]

No mockery. Some advice. But no real answer to your question.

First thing I doubt that you will ever have a positive cash flow. At best most two family situations will afford you a discount on your portion of the payment. Over time that might become a higher percentage of the total.

Because of the wide range of labor cost and overhead no one in this group can give more than a wild guess about prices. Even it you were in my locality, the things you mention have to be seen to even make an educated guess.

In your shoes I would do the following make up 3 lists. The things you must do to acquire the financing, another of things that really should be done and a wish list. With a certified contractor doing the work HUD may advance the money to complete the first list provided the improved property will appraise for the total of the loan. I don't recall which type of loan this is.

Best bet is to find a local, well referred contractor, be honest with him and pay him for the time he spends developing a plan and estimate. That will be "better spent" money than what you paid the home inspector.

Colbyt

[tioga0630]

Colby, Mark, Bill, and everybody:

Thanks for some insightful advice. The idea of taking a contractor along when I'm home-shopping for an older home is so smart, I'm surprised no one ever mentioned it to me (or on any DIY show that I know of) before. Sort of like "inspect-as-you-go."

The wind-up is that we lowballed at 60K (because whoever said we might have to add *5* zeroes was absolutely right), were declined, and that's the end of that.

I learned after having bid that this former bed-and-breakfast (HEL-LO, Bill, in New Eagle--exactly diagonal from ya'll) is notorious in the local real estate market in this toney county. Apparently the old dude selling started out at 130K and has been coming down (to 80K) for almost eight years. A GREAT home inspector who didn't charge a penny, the former head of the real estate agents society in this particular county, told me the seller is possibly a little disturbed...

Anyway, thanks again for some great words. (And Bill, don't I know the feeling of gorging an old house with money, and then hearing the new owner ripped everything out in the first week. As Andy Sipowicz would say, I'm keepin' a good thought for ya.)