Adding rooms to property

[Boab64]

Hi Guys,

I have been browsing through the MLS and have come across quite a few properties that have three bedrooms but one bathroom. I don't have kids but I do know that if you have Mum and Dad in bedroom one, little Jimmy in bedroom two and little Lucy in Bedroom three, if you have one bathroom that is a recipe for frustration. In my view the better set up would be three beds and two baths. Now if we take the kind of properties we look at in the ICI list (can't remember if there is a 3bd/1ba), given the nature of design and construuction, how easy would it be to add that extra bathroom?

Is it as I imagine a very important marketing issue or have I got it wrong.
How much would such a thing cost.
How much would it add to the value of the house?

From where I come from (UK) everyone is conscious of the cost of land (little island - land price like gold) so people try to use the land they have got and extend their property into it to add value. They build up, sideways, they even build down into basements and beyond.  Can you add value to these kinds of properties by adding rooms or is the nature of the market such that you wouldn't get your money back?

Any other issues in terms of construction? Do you need planning permission to add another room?

Any thoughts would be welcome.

Robin

[Brian Lee]

An important component in pricing and marketing a property will be in looking at the market and your competition (ie. listing and sale comparables).  Most of the homes that I am putting out as investment deals are in areas that having one bathroom is common.  I would agree that having a second bathroom in a three or four bedroom house would be ideal.  However, it is not an "expected" feature in these areas.  Also, the expense is almost always probititive.  Appraisers like myself use the term "incurable", meaning that the cost to make an improvement (ie. bathroom) costs more than the value you would get of the improvement.  As an example, it might cost $5,000 to add a bathroom.  If the market will only allow for an increase of value at $2,500 due to that bathroom addition, then the improvement is considered to be incurable.  If you were to spend the same $5,000, however, and receive at least $5,000 of market value, then the improvement would be considered curable.  In most cases, room additions will be incurable.  Having said that, I just went out to a property this past weekend with 4 bedrooms and only one bathroom.  The house has a perfect area for a second full bathroom.  The cost will be nominal because it will only involve a slight conversion of space.  In that situation, adding the bathroom is going to become part of the rehab plan.  Not every property will see that type of renovation though.  In fact, most of them won't due to cost and more importantly the market expectations in those particular areas.

-B