I’m currently looking at a property which needs major rehab work. I have a total purchase price + rehab cost budget and it is important to accurately estimate rehab costs before getting into a situation where I’m uncomfortably over budget.
The property is approximately 1150 sq. ft and has an un-permitted addition of about 480 sq. ft. The un-permitted addition is a living room but it is essentially a back patio which has been walled off. In order to qualify for a loan, the house would need to be brought back to its original state. Since my plan originally was to make a cash offer and use it as a short term rental, I’m thinking that the room can be divided into 2 additional bedrooms. One of the most important things for STR is sleeping capacity and 2 additional rooms would allow the house to comfortably sleep 8.
I will update this post later on.