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Upgrades That Increase Property Value and Rental Rates
Getting the most value out of your rental property is a high priority but knowing exactly where to focus your updates can be tricky. When planning upgrades, there are many factors to consider. And we’re here to help you sort it all out with advice on rental property upgrades that increase property value. You can attract and retain good tenants with focused, quality upgrades — and if you do it right — you’ll be able to raise the rent after the hard work’s done.
Paint, Kitchen and Hardwood Floors
Making key updates to your rental is mostly about prioritizing. Because you know your rental better than anyone else, you probably know what needs your attention most. But, you’d be wise to spread the wealth and make improvements across your space, rather than focusing on just one area.
Here are a few low-cost/high-impact changes you can make that can catch your tenant’s attention and help add thousands of dollars to your bottom line:
Attend to the walls. If you find yourself realizing the interior is in need of a fresh coat of paint every time you walk into your rental, you may be on to something. Take a look at painting trends and consider expanding your color palate to include different shades of the same tone to add some modern flare.
Paint the front door. Simple as this sounds, a fresh splash of paint on the front door can add vitality to your rental in no time at all.
Budget for kitchen upgrades. You’ve seen rental listings that lead with their sparkling new stainless steel appliances. Property management groups push these higher-quality upgrades in rental listings because they get attention. Upgrading your kitchen appliances is also something you as a landlord can take on independently, if you’ve got the skills.
Plan strategically on when to buy. Purchasing your upgrades at the right time can score you interest-free payments, free delivery and sometimes free installation. Add to that, some installers will even cart away your old fridge, countertops or flooring without a disposal fee. Save up for these major purchases and buy during big holiday sales.
Look carefully at the floor. Wear and tear can really start to show, and that’s never been more true than with tired flooring. If your carpet’s looking weathered and weary, consider investing in hardwood flooring, which can decrease property maintenance. Tenants love the visual aesthetic that new solid wood floors bring to a space, and you won’t have to shampoo carpeting between tenants.
Keep it non-smoking. A smoke-free rental can attract a much larger audience than one which allows smoking.
Improve Your Property’s Curb Appeal
Your rental property is still real estate and even though renters don’t own property yet, they’re still hoping to find a beautiful place that they can call home. Don’t undervalue first impressions and curb appeal. Set aside a little time and money to revamp the exterior of your space. Beautifying the exterior isn’t just for single family homes, either.
For owners of rentals that don't have much access to the exterior, pick up a few potted plants for the balcony or patio. It can really help add a little life to the exterior of your property.
If you’re paying dues to an HOA or condo association, you have the right to request that common areas and outside spaces are kept up and looking great. Get in contact with your board and officially petition them to take action on improving the space if anything’s lacking. It’s an investment you’re making anyway — and the cost to you is likely covered by your tenant’s rent payment. So why not champion for a beautification project that benefits everyone?
Consider Small Cosmetic Upgrades to Living Spaces
Working on a tight budget doesn’t mean you’ll have to sacrifice quality. You just need to know where to shop and what to upgrade. Consider how your space will show when it’s empty, and look at how your updates will impact the walk-through experience — you’ll be able to target your upgrades.
Settle on changes and decorations that will improve your unit’s aesthetics and increase your rental rate. Rental property upgrades that increase property values are important, but by focusing on upgrades that make your rental easier to maintain and monitor, you’ll be doing yourself a favor too.
Review the windows. Replace cheap, dusty horizontal blinds with affordable wood blinds. Get online and you’ll find quality, customizable products you can order with a few clicks. Tenants will be able to clean these quickly and they’re more durable too. Another big perk is that they’re usually easy to install yourself.
Upgrade the bathrooms. Simply swapping out a vanity and mirror can quickly bring a dated and faded bathroom into the modern age. New, single-unit vanities with granite tops and matching mirrors add storage and durability with one easy adjustment. Your rental rate can be dramatically increased with the addition of a washer and dryer there if space allows.
Get smart. Nothing captures attention like cool, new Internet of Things technology sprinkled around your rental. From state-of-the art home security systems, to web-enabled light bulbs, you can make an inexpensive and lasting impression.
Upgrade the lighting fixtures. Swap out old fixtures and do it with style. Sourcing inexpensive, high-quality light fixtures with eBay or LampsPlus can help to bring style and a touch of modern flare to each room. Many items found on these websites are in new condition and sold at serious discounts.
Encourage Tenant Renewals With Incentives
Fostering renewals with a tenant-driven rewards program can improve retention. Build up hype about renewals at lease signing — framing them as anniversary celebrations — and offer your tenants an opportunity to choose an upgrade from a list you provide to them.
Allow them to select from low-cost items that add value to your rental and offer them a real reason to stay. New tech like a video doorbell or a web-enabled thermostat can help seal the deal on another year’s rental income. Be sure to discuss the incentive again when delivering your renewal request a few months before the lease comes to term.
Update Your Landlord Insurance
When you’re done making these changes, you may be surprised how well you stretched your budget. Best of all, these upgrades can translate to a higher resale property value when the time is right. And as for the time between, you’ll be able to charge higher rental rates, compete with a better class of rentals and boost your profits too. Now that’s a win-win!
As you build out and upgrade your rental, you’ll want to be sure your finances are protected should the unexpected happen. Contact your American Family Insurance agent to discuss the adjustments you’ve made to the rental. You’ll find well-tuned coverage that’s both affordable and easy to understand. And best of all, you’ll have the peace of mind that only comes with the knowledge that everything you’ve worked so hard for is carefully insured.
This article is for informational purposes only and includes information widely available through different sources.
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