I have just settled on a house that needs some renovation. Built roughly 1945.
The floorplan is a little strange (added on). Currently it has 2 large, 1 medium bedroom large separate lounge, and kitchen/dining & second living area (living area about 3m x 3m). This kitchen/living /dining area is in a T shape and a bit poky, kitchen virtually non existent.
I’m thinking of taking 2 walls out, putting 1 wall in to make a largish lounge/kitchen /dining area in a square shape. This will get rid of one of the big bedrooms and create a small bed room out of the existing 2nd living area OR I can leave the small 2nd living area as part of the kitchen/dining/living area – making it bigger and making the separate lounge a bedroom.
The house was previously rented to students who used the separate lounge as a bedroom, effectively using a 3 bed home as a 4 bed home.
The house is in Newcastle, about a 5 min drive to the uni, in a “urbane core precinct”, although I would prefer to rent to a family as I think they would stay longer and treat the house better.
My question is: Am I better off rent wise and house value wise having a 4 bed home with 1 living/kitchen/dining area (probably slightly disproportionate to the size of the bedrooms) or a 3 bed home with 2 living areas (still having the option for renters to use the separate living area as a bedroom).
I have one week to make a firm decision. HELPI think if you converted it to a 4 bedder then it would be great to rent out the rooms individually for student accommodation. Although there is the risk they won't take care of the place.
If you're more focused on renting to a family I think the kitchen reno would be great. Certainly more appropriate for family living conditions.
Crunch the numbers… then decide. Sounds to me that the least work would be to use it as a 4 bedroom property, this would allow you to rent to 4 students and most likely give substantially more rent than if you make it a family home? If so that's more yield for less investment.
I agree with freelance. If you can get students to rent, 4 bedroom is the way to go.
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