Many landlords share the same goal for their rental property, and that's to increase its value over time. There are several benefits with little downsides, which is why it's a popular business strategy among property owners. Fortunately, there are multiple ways you can do so.
Rental Property Improvements You Can Make
Fresh Coat of Paint
A new layer of paint can do wonders for your rental property. It'll immediately add value to your rental even if you only do so for the front door. You can even change the color based on whatever the current trend is. This can increase your property's curb appeal to attract tenants. It also allows you to take updated property photos for rental listings.
Landscaping
As another way to increase the curb appeal of your rental property, you can spruce up your landscape by trimming your plants and power washing the floors. It's among the regular property management tasks you need to do, but you don’t have to do it yourself thankfully. It’s a great idea to hire a manager to do the maintenance for you. They can keep your exterior and interior neat and organized for potential renters.
Upgrading Appliances
Unlike furniture, appliances become outdated much quicker as new models and electronics are released. If your rental property is furnished, it's best to start upgrading the appliances like microwaves, stoves, and dishwashers, or add new equipment like air fryers. Potential tenants who have no appliances of their own will see this as a perk of renting from you.
Installing High-Speed Internet
You'll barely see anyone who doesn't browse the internet anymore. Most people are online, whether it be for entertainment, leisure, or work. It’s beneficial for your tenants, your property management team, and you to have an internet connection. This will be appreciated by remote workers and online learners, but be sure to choose an internet service provider that provides a reliable connection.
Adding Smart Home Technology
Rental property upgrades like adding smart home technology can be a unique feature you have that other rental properties don't. It's a premium convenience, especially for people with disabilities or the elderly. Depending on the kind of technology, some electronics can be controlled through voice commands, and having a single console to control electronics is something many renters would appreciate.
Prioritizing Energy Efficiency
Installing energy-efficient appliances allows your tenants to save money on energy costs, depending on your lease agreement in terms of utility bills. This can be as simple as changing the bulbs in your light fixtures to options that consume less power, to installing better insulation to prevent the overuse of the HVAC system during severe weather.
Kitchen and Bathroom Upgrades
Potential renters also look at other areas in rental properties like the kitchen and bathroom. To attract higher-quality tenants, ensure you have an up-to-date bathroom and kitchen by modernizing the space. You can do so by adding new appliances to the kitchen, installing new bathroom fixtures, placing the floors with ceramic tile, or generally remodeling the rooms.
Building Storage Units
Building or adding more storage space in the rental space is also a plus since tenants tend to bring items of their own once they move in. You can build a storage room or install shelves as part of the rental property, but if you don't want to spend too much money on property upgrades, you can always buy shelves or cabinet hardware you can assemble and set up in the rental unit.
Maximizing Outdoor Space
There's a lot of potential for the space outside the unit, and you'll be wasting it by keeping it unoccupied. To take advantage of the outdoor living space, you can build an outdoor kitchen, a grilling station, a patio, or whatever tenants are currently looking for in the rental market. It's best to hire a professional to conduct a rental market analysis to get accurate data to base your upgrades on.
Why Improving Your Rental Property is Worth It
Increasing Property Value
As mentioned in the title, making these upgrades will increase the value of your rental property bit by bit over time. You can start small by getting new light fixtures, or something bigger like placing new countertops. You’ll be happy you did when you decide to exit the rental business, as you’ll more than likely sell the property at an amount higher than the original purchase price.
Deduction to the Property's Taxable Income
Most of what you'll spend on upgrades could turn into tax deductions from your rental income. Whether the upgrades are a big or small investment, you’ll get to trim down what you owe in tax with each purchase.
Higher Rent Prices
With a more attractive rental unit overall, you can increase rent prices for your properties as you improve upon them. Of course, your upgrades and additions should justify higher rental rates. However, not knowing how to set the rent price correctly will drive away prospective tenants, and they will opt for other rentals with a lower price. This is why property management can be so important for a successful rental business
Helps Retain and Attract Potential Renters
After acquiring rental applications, tenant retention is also just as important. Both can be positively affected by the additions and upgrades you make. Keep in mind that staying up-to-date on routine maintenance is also crucial after you make the improvements to keep them in good condition.
Rental Improvement FAQs
How often should I make upgrades?
For appliances, it might be sooner than other upgrades since new options are released more frequently. With other things like a fresh coat of paint, the addition of double pane windows, or remodeling, try to make a few changes at least once each decade.
Will the costs be high?
Focus more on what the return on investment will be. New flooring might cost you quite a bit, but you will likely get more tenants since new floors are a great selling point. Even simply keeping your exterior clean significantly improves your property's curb appeal. Know how to market your rental property by highlighting these new additions.
Will new upgrades mean more maintenance costs?
With upgrades, you will most likely have the same maintenance cost as before. With additions such as new laundry facilities, there will be an increase in costs. However, it is a small price to pay if it means getting high-quality tenants and adding to your rental value. Plus, you can always charge more rent once you add value to your property.
How do I maintain my property's value?
All you have to do is conduct proactive maintenance and tenant relations. Check your roof regularly, respond to maintenance requests to keep tenants happy, and be thorough with tenant screening by checking criteria like their credit report or eviction history to ensure you get tenants who will respect your property.
Keeping Your Property's Value Through Professional Management
Maintaining the value of your rental property is continuous work, and it will require a lot, if not all of your attention especially if you have many tenants. You can hire professional property management services like PMI Georgia to oversee your business operations, increase cash flow, and find potential tenants for you as other landlords do.
Not only will you earn passive income, but you'll also be able to focus on other business opportunities in the rental industry or focus on your own home. You can use our free rental analysis tool to determine whether you're getting the most out of your property, and if not, we can certainly help you get there!
