Return on Investment
Investing via Housing Plus is a Good Thing
To determine whether or not a re-investment into your property by way of the Housing Plus proposition makes good business sense, the key factors to consider are the cost of construction, the cost of that money, and the minimal gain of the new rent revenue. Here you are provided a couple examples of real life Housing Plus projects.
But first, here are some qualifiers.
We have seen unfinished spaces with ceiling heights as tall as 11 feet, and others a little low for the owners taste such that construction costs included some excavating.
Moving meters or modifying laundry rooms is not difficult, but could add to construction costs.
On the other hand, there are economies of scale when adding two or more new units, thereby reducing some of the per unit soft costs as well as construction costs.
For these sample projects highlighted here, there were no corners cut on quality; reasonably priced new appliances, granite counter tops, etc.
Rent revenue for new Housing Plus units can vary based upon location.
Also, because these new Housing Plus units are being used as “affordable” or for “income eligible households,” rental subsidies became the common consideration toward both compliance and maximization of rent revenue.
For example, a subsidy voucher for a 1 bedroom apartment can vary from a base amount of approximately $980 per month to as much as $1470 in opportunities areas and, similarly, for a two bedroom unit, from an $1139 base to $1660. And, so on.