Me on Stage at OREIO vs Legal Basement Units
(Here is a picture of me on the right.)
In September, I was invited on stage at the Ottawa Real Estate Investors Organization (OREIO) by my coach Rich Danby to talk about my experience in converting bungalows to ones with a legal basement unit.
Great crowd of about 200 investors. Answering Rich’s questions in front of this crowd was easier than I thought, thanks to Toastmaster skills developed over the years.
Adding legal basement suites in bungalows have many advantages with the biggest one being extra cashflow.
There is so much to say that I might have more blog posts on more specific topic later.
Expect Delays and more costs.
This type of project is more complex than a simple renovation or buying a house to rent out. There is lots of special knowledge involved and many factors to coordinate. Based on my experience in project management in the government, I should have expected that this project would not be on time and on budget. It took 7 months, just 2 months over what was planned and was about $30,000$ over budget.
A big part of being over budget and overtime is due to the contractor one chooses. Even if the contractors interviewed check all the pass marks, doesn’t mean that their performance will match their answers, you might be in trouble. So, I recommend to be involved and stay on top of everything.
As I noticed a lack of progress, I negotiated that a 2nd general contractor was needed to focus on the main floor renovations while the first contractor kept working slowly on the basement.
Next project I would put a clause in the contract that instruct of the work has not started within a week, I move on to the next contractor.
Splitting the utilities meters (i.e. electricity meter, water meter, etc..) in my mind is mandatory as it prevents future wars with tenants.
-Have your materials and finishes selected before project starts. Use a designer or architect technologist to assist you. It saves time as you will need to manage issues during the renovations.
-Don’t buy a house in December – everybody is on holiday mode and your City’s permit office might be closed for 2 weeks, where no work happens and therefore delaying the project.
-Don’t do renovations by yourself, unless you have skills and tools. You already have a full-time job, you might not want a 2nd one.