Owning a rental property can be very lucrative, and if you got a great deal on the property itself, the deal may be even better. Making improvements to the property can enhance its value further.
Appearance is everything in real estate, but some landlords don’t seem to take as much pride in their rental properties as they do in their homes. This attitude is a detriment. These days, renters are looking for a mix of value, function, and aesthetics in a rental property. And of course, upgrades not only attract better tenants and potentially allow you to charge higher rents; they also increase the value of the property, should you decide to later sell.
Luckily, it’s easy to maximize the value of your rental property with just a few simple upgrades, such as new fixtures and a fresh coat of paint. These upgrades don’t have to be expensive, but they can make a big impact: the difference between a $100,000 property and a $150,000 property may only be a few thousand dollars’ worth of upgrades. We’ll show you some of the easiest tips and tricks for upgrading your rental property on a budget.
Start with the Basics
First and foremost, start by thoroughly cleaning your rental property. This tip may seem simplistic, but a clean space does much to showcase your property to prospective tenants. Cleaning should include both the inside and the outside of the property, including the yard and the garage. Shampoo the carpets and remove stains, clean any vents, and change out the HVAC filter. The kitchen and bathrooms will be scrutinized the most, so prioritize these rooms above others. Keep an eye out for mold, mildew, grease build-up, and other unsightly (and potentially unsafe) residues.
A fresh coat of paint is another simple upgrade that should ideally be completed after every tenant moves out. Go for neutral colors that brighten the room and make it appear larger. However, if you had a short-term renter, new paint may not be necessary.
If you decide to re-paint, save money by visiting discount stores that typically have a selection of basic interior and exterior colors. Avoid high-gloss finishes, since they typically require more coats; instead, opt for flat or semi-gloss versions to save some cash. You may also find it easier to purchase paint that already contains primer. A home improvement store professional can help you choose the best paint for your needs.
Make Simple Kitchen Improvements
Most savvy real estate investors know that a kitchen can make or break a home. When searching for a home to purchase, many people are willing to pay extra for a great kitchen. The same is true generally true for renters as well.
You can make improvements to the kitchen by starting with the countertops. Nothing says cheap and outdated like inexpensive laminate countertops. Although these are the cheaper option in the short term, laminate counters typically do not stand the test of time. If these countertops were present when you purchased the home, consider making the upgrade to something more durable, such as marble, quartz, or granite.
New appliances can also be well worth the up-front cost. Many renters are looking for smart, energy-efficient appliances that help them save on their water and electricity bills. Millennial renters, in particular, have shown they are more open to paying more for units that include such appliances. Research backs this claim, as an NAA Amenities survey revealed that upgrading to energy-efficient appliances can generate over 15% more rental income.
Swap Out Old Fixtures
Swapping out fixtures like doorknobs and light fixtures can do a lot to change the aesthetics of your rental property and increase its value. Most home improvement stores have a huge selection of inexpensive, yet eye-catching fixtures that are easy to install.
Some examples of fixtures that may need to be replaced include light switch covers; old, inefficient toilets; faucets; worn cabinet hardware; blinds with missing slats; and ceiling lights. If you’re having trouble figuring out which fixtures would look best in your property, consult a friend with an eye for detail or enlist the help of a professional. You can also get design inspiration by searching websites like Pinterest, Houzz, and YouTube, or by watching home improvement TV shows.
Don’t Forget about the Outside
When you are making upgrades to your rental property’s interior, it’s easy to forget about the outside. However, curb appeal is also something that can attract tenants, so it’s worth paying attention to.
Upgrading the outside of your property does not have to be expensive. Some cheap ideas that will add a lot of curb appeal include swapping an old mailbox for a stylish new one, adding outdoor lights, and pruning back overgrown shrubbery. If you have a higher budget, consider upgrading the siding, walkways, or driveway as well.
Studies have shown that curb appeal is a major factor when people are looking to buy or rent a home. In one survey, the results indicated that even inexpensive improvements significantly increased the participants’ perceived value of the home. The survey also indicated that properties that took time to pay attention to curb appeal seemed to stand out better particularly in subdivisions, where everyone’s home generally looks the same.
Some Final Tips
Be sure not to ignore any structural problems such as electric wiring, insulation, roof, and plumbing issues—these are obviously critical to address. In addition, some upgrades cost more than others, so it’s important to have a budget that fits the scope of the work you have in mind. Be careful not to overdo it; make sure that any upgrade actually adds value. By focusing on specific improvements and doing a little research, you can make the best decisions on which upgrades are important for your particular property.