RENO’S IN A QUASI-COVID WORLD
Apocalypse? No! But plenty of drama! Finally, humans are emerging from the chaos of Covid. In many places there are fewer people getting sick, and more people protecting themselves with vaccinations. The supply chains, however, are not as quick to recover from this pesky virus.
I hear ya, “this is not news!”
Nope, but it is part of our reality as real estate investors. So, how do we deal with it? Just buy turn-key properties until 2022? Tell our tenants to just board up that window? Avoid repairs & reno’s until prices come down?
Clearly none of these options is likely to work for very long.
Many of you already know that our main business is doing residential renovations for clients. Then we also include renovations into our investing strategies. So, it’s all reno’s, all the time. Here’s what we know and have seen in the biz so far in 2021.
- Expect delays. It might be for a supply item (your favourite tile) or it might be that one of your trades’ people needs to isolate for a close contact. It will happen; it’s not the end of the world. Start with your goal timeline and stick to it as long as you can—but know that you probably need a buffer of weeks before you move in, show to tenants, list with a realtor, ….
- Prices are in flux like we have never seen before (and that’s over 400 different renovations!). Many companies and trades are only holding quotes now for a week or two; some companies have special clauses in their contracts to allow for price increases. You still need a quote, and you still need a budget. But it’s more important than ever to have a contingency fund.
- Problem-solving has become the norm. Ask yourself or your trades, “what else could we do to move this project forward?” Can you use a different plumber if he’s on quarantine for 2 weeks? Can you pick a different tile if it’s still on a boat somewhere?
- Patience!!! We know, time is money. We’d all like to be done with this and move on. Sorry, no one has that magic wand. If you’ve already tried other solutions, your project just might need more time. Your contractor is likely doing their best—he or she is probably even more frustrated than you are.
- Many window suppliers and installers are still busy after the hailstorm of last June (Calgary). Expect 6-8 week turnarounds as the norm. Or, you could call around to see who might have a shorter timeline?! We expect this to continue as people take advantage of the new federal program “Canada Greener Homes Grant.” This program is just starting, so the impact is likely to stay with the window suppliers for quite a while.
- Inspections? Permits? These folks are probably working from home and working through a myriad of challenges—just like you. Send them everything they need, right away! Prioritize any communication from them and respond within the hour. Recognize, almost every city has a backlog these days; waiting is probably part of your process. Apply ASAP!
As real estate investors, we all have choices. We can choose to wait it out. We can choose to increase our budget. We can choose to allow an extra week/month or two into our budget timeline. We are keeping it positive and keeping it real.
What we know for certain, is that planning your renovations just became much more important, and tricky. Order as much as you can in advance. Plan your trades in advance whenever possible. Pickup and store your materials early if you can. But these days, even the best laid plans may still get side-lined from some wild delay. It’s just part of the “new normal” for 2021. Fingers crossed for some stability by 2022?!
