How to value an apt that needs renovation work?

at today's market, it's hard to imagine a $150 as Renovation Discount. but because of the same reason, try you best to cut the deal. You might be right that the sheet rock you put in the building wouldn't be reimbursed at the sale, but an apartment in good condition naturally worth more and a lot easier to make the deal. Also, if you actually live there for a period of time, it is important to make sure the apartment is safe and mold free. As an architect, I suggest you to consult an inspector. You can also reach us at info@cooparchstudio.com to request a one-time FREE on-site consulting. We would be glad to help you to turn a falling apart condo into you dream home, and it is FREE.

don't forget to factor in the time and stress and work of the renovation. You will need to live somewhere else for many months(which has a cost) and that timing may change with construction delays, permit delays, etc. But you may also get exactly what you want!

Most likely, the apartment is already priced at a discount. Pressing for even more of a discount would be piggish.

Actually it's not! The apt has been on the market for 10 mos, they priced it at $1300 a sq ft for the ask (it's a nice UES post war building but it's not Chatham House - $1300 per sq ft is def crazy). Hence I need to figure out how to discount it if I need to put in a bid for it!

"$1300 per sq ft is def crazy"

Your opinion.

The sellers apparently feel otherwise.

This isn't magic. You look at building comps, and adjust downward for the one you are interested in by deducting reno costs. Realize it is rare to make all your money back on a reno upon reselling. Also figure that you will have to pay to stay somewhere else during the 8 months it takes to hire architect, get plans drawn, submit for approval/permits, hire GC and get work done. The reno you discuss is NOT $100,000 if condition is as you say. That would be a severe budget reno for an estate condition jr-four-type one-bedroom/1 bath apt. You'll need new kitchen, 3 new baths and that alone is $100,000 with budget finishes. Add to that windows, floors refinished at very least if not patches/replaced, serious wall work in multiple rooms that may include skim coating or replacing sheetrock, likely new closet interiors, possibly replacing doors, lighting, let's not even get into electrical upgrades like putting enough outlets to handle today's electronics.... You are talking EASILY $150,000 minimum if you cut every corner and and go really low-end, but more likely $300,000 if you do a nice job. Remember you will need an architect or you will want to kill yourself by the end. That costs about $25,000-30,000 including construction oversight and expeditors for an apartment this size. If you decide you need to move a closet or two and shift a wall or doorway here and there, the price obviously is impacted.

The point is that this is a major undertaking you have to be ready and up for. If you plan to live there 10 years+, it may be worth it. If not, I doubt you will get the purchase price low enough for the amount you put into a reno to make any sense.

Bottom line: get average sq/ft price for other similar units in building, basically ignore condition of those other units, subtract what a reno would cost you, and that is your bid. If the seller is unrealistic and you explain your thought process in coming to the offer price, then there is little you can do.

Thank you kylewest, your insight is very helpful. I really need to rethink if I even want to take on such a huge project. Living someplace else during the reno period is not a big problem since I am in a rental unit right now. We can extend our rental lease for the work period. But I also just had a baby and working fulltime so I have hesitation about adding another big project to my life! I think I can handle a small reno (maybe just redoing part of the apt, i.e. just floor or bath or kitchen) but probably not a full-blown gut reno if it takes 8 months of aggrevation.

Reno is a project no matter what you decide in terms of scope. Kitchen and baths are big projects. Refinishing walls is a mess. And doing some now and some later is utterly unrealistic since you'll never vacate for Phase II and having it done while living there is insanity. An estate condition apt does not sound like a project you want to undertake. It requires daily site visits if possible, a great deal of attention to details, working closely with an architect and GC, a lot of showroom visits, etc to get the job done well and within budget. Sounds like a nice roomy place, but maybe you really just want a place that needs sprucing up versus top to bottom redo.

Reno is a project no matter what you decide in terms of scope. Kitchen and baths are big projects. Refinishing walls is a mess. And doing some now and some later is utterly unrealistic since you'll never vacate for Phase II and having it done while living there is insanity. An estate condition apt does not sound like a project you want to undertake. It requires daily site visits if possible, a great deal of attention to details, working closely with an architect and GC, a lot of showroom visits, etc to get the job done well and within budget. Sounds like a nice roomy place, but maybe you really just want a place that needs sprucing up versus top to bottom redo.

Reno is a project no matter what you decide in terms of scope. Kitchen and baths are big projects. Refinishing walls is a mess. And doing some now and some later is utterly unrealistic since you'll never vacate for Phase II and having it done while living there is insanity. An estate condition apt does not sound like a project you want to undertake. It requires daily site visits if possible, a great deal of attention to details, working closely with an architect and GC, a lot of showroom visits, etc to get the job done well and within budget. Sounds like a nice roomy place, but maybe you really just want a place that needs sprucing up versus top to bottom redo.