Five Rental Upgrades That Will Yield Big Dividends
Your tenant has moved out and now your property is vacant. The next standard step is to slap some paint on the walls, deep cleaning the interior/exterior and shampoo the carpets. However, doing the minimum will usually lead to minimal returns in terms of money and time of tenant occupancy. And since we know, that no matter what kind of residential property you own, be that condo or townhouse, maximizing your income is always a high priority for an investor, minimal isn’t good enough.
In order to get the best return on your investment, stay at the high end of the rental rates by improving your property value and avoiding tenant turnover every lease term.
Here are 5 ways to make your listing the hot ticket item in the neighborhood!
1. Curb Appeal
When you drive through a typical neighborhood subdivision you can normally separate the homeowners from the renters pretty quickly. It starts at the curb, since the first impression of a home and a spot most investors neglect, is the exterior curb appeal.
While it is tempting to forgo the much-needed coat of paint, leave a battered fence up and fail to plant flowers or groom trees/shrubs. This is not a good sign to a renter and could be a potentially negative reflection of how they see your maintenance style. Making sure the driveways are free of pot holes, the front doors are working properly, have good weather stripping and are freshly painted and the general exterior of the home, including buildings such as sheds, are clean, is a great first start to landing that high paying tenant.
Appliances, appliances, appliances are among the first things a renter usually looks at after entering a potential new home. In some cases it’s just as important as the location. Old, half functioning or non-matching appliances will NOT get you top dollar. Additionally, they can also lead to more hassle for you, down the road, in the form of unending maintenance calls. Instead of slapping a Band-Aid over it, choose instead to invest in a good, high quality, matching appliance package and make sure it has a warranty. If your home is setup with washer/dryer connections you can always add a set to further increase the value of your rental property.
This is a big one and also a tricky one because everyone has an opinion and you won’t be able to please all potential renters, no matter how hard you try. The options range from reasonable to pricey but all flooring immediately raises the value and rent in a rental property.
Carpet is an option that may have to be changed out every other renter and that can get really expensive, as well as has a negative impact on your annual rate of return. One ketchup stain can ruin a new carpet forever. However, some tenants like carpet, especially in their bedrooms and during winter. On the other hand the majority of renters may have a carpet allergy or a child with carpet allergies. Just be aware of the option, both its pros and cons.
Opting for a mix of two by putting carpet in the bedrooms and wood flooring throughout or a blend of wood flooring and ceramic tile, is another great option. Choosing one of these options, in place of the old vinyl or linoleum flooring in bathrooms and kitchens, is also a huge plus to renters, as it is often viewed as unsightly and usually lower quality than ceramic or travertine tile.
4. Cabinets & Countertops
Upgraded countertops really add value to your kitchen and appeal to renters willing to pay more for upgrades. While there are many options to choose from, including concrete and granite, invest in durability, functionality and a style that will stand the test of time.
With cabinets sometimes a fresh coat of paint and new fixtures will go a long way. However, if you have the old particle board cabinets that have outlived their usefulness, then you should upgrade to a more modern and functional option. Remember storage space is a hot commodity and an appealing bonus to a rental property.
Investing in higher quality light fixtures, adding new ceiling fans, upgrading all faucets (kitchen – bathroom), will give the rental property a more modern and pulled together look. Since tenants notice event the smallest things, like door handles, locks, and window blinds.
Spending a few dollars on upgrading these assets to your rental will ensure you are able to lock in those high paying tenants.
When competing in an active rental market you need your property to stand out above other properties listed for rent. Quality upgrades done professionally will get your rental property filled faster and maximize the income on your rental investment. The benefits of adding rental property upgrades extend beyond appearances, however. From improving your annual cap rate or rate of return to improving the home’s value for resale and even developing a healthy, legal relationship with your tenants, upgrades equal value on so many levels.
If you have questions or need assistance, please reach out to us, here at Vic Green Realty!
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“These upgrades will set your listing apart from others sitting on the market and getting it rented faster, which is going to save you money upfront.”