If you’re reading this article, chances are you already know the benefits of real estate investing. You get tax write-offs, your tenants are paying your mortgage for you, and any money left after you pay the mortgage, and other expenses is cash in your pocket.
Keep reading to learn more about the best projects to do when you’re renovating to rent to keep your costs down and maximize the rent you can ask for.
Renovating to Rent: Do These Things
If buying a fixer-upper to renovate to rent is part of your investment plan, you’ll want to make smart choices about what you choose for the rental. This article by High Return Real Estate does a good job of walking you through setting real estate investing goals and achieving them.
One of the ways you make money on rental properties is when renovating a rental property. You need a different way of thinking when renovating rental vs. renovating your own home.
Don’t choose things because you’d like them in your own house. Instead, you need to make choices that will hold up among multiple renters, be easy to clean and maintain, and won’t be extremely expensive to repair if they are broken or damaged.
Here are some renovating projects, both inside and outside, that are often attractive to renters and will give you a good return on your investment.
Kitchens and Bathrooms
Updated kitchens and bathrooms wow potential renters. Stainless appliances (or at least matching appliances), refreshed cabinet fronts, and new floors or countertops can sell your place to renters.
Don’t go over-the-top though. You don’t need a gourmet kitchen for renters, but updating the appliances if they are old and decrepit is a good place to start. Replace old, outdated, or damaged flooring and consider re-facing or painting the cupboards if new ones aren’t in the budget.
Bathrooms should be deep cleaned. A good cleaning can go a long way and might even reveal that things don’t actually need to be replaced.
Make sure the shower and any tile are free of mold and mildew, paint the ceilings if there are any water or mold spots, and ensure that the fixtures and mirrors are clean and free of fingerprints.
Handles and Fixtures
Replacing the handles to your drawers and cabinets, doorknobs, and bathroom and kitchen fixtures is easy, relatively inexpensive, and often doesn’t require a professional.
Making sure all fixtures and handles have similar finishes make the space look polished and appealing. Don’t choose a top of the line lighting and fixtures. Contractor-grade choices (which you can often buy in bulk for a discount if you’re doing multiple renovations) are sufficient to update the property.
Paint
Paint should last a good 3-5 years, but you might have to touch up or re-paint between tenants if there is a lot of damage, a lot of holes that need to be filled, or if the paint looks dingy.
Skip the plain white; pick something with a little bit of color, such as a cream, to hide any imperfections on the walls. You should also paint the entire place the same color (and even better, paint ALL of your rental properties the same color). This makes any touch-ups much easier.
Landscaping and Outdoor Spaces
Just like curb appeal often can sell a house, curb appeal can rent an apartment. If your prospective renters pull up to a rental property with unmowed grass, weeds, and dead flowers, they’ll probably wonder if the inside is the same and whether you’re going to be an absentee landlord.
Clean up the landscaping, consider planting a few perennials, which re-bloom each year, and make sure the lawn is neat and tidy.
Off-Street Parking
Providing off-street parking is a huge bonus, especially if your property is in a busy area with limited parking and lots of parking restrictions. Off-street parking is a huge selling point for a rental property, so if you can make this happen during your renovations, go for it.
Laundry Area
It doesn’t need to be a full-blown laundry room, but if you can find the space to put a washer and dryer (even ones that stack), you can up your rental asking price and provide an amenity that many renters are looking for.
Not having to lug their stuff to laundromat will attract lots of prospective tenants.
Secure the Area
Providing security features, such as deadbolts, motion-detection lights, and locks on sliding doors or french doors to a deck or patio or relatively inexpensive, but can help your tenants feel safe. They’ll also benefit you when the property isn’t rented.
Renovating to Rent: Don’t Do These Things
You might be tempted to go all out on your renovation. New appliances, new carpet, new sinks, and toilets. Don’t do this. Think about what could be repaired rather than replaced.
Carpet is a big one. If you have decent rental-grade carpet, a deep clean from a professional cleaner can have it looking brand new for a few hundred dollars. Don’t replace the carpet unless you absolutely have to.
Don’t get carried away when renovating bathrooms and kitchens, either. Unless there are issues, you don’t need a new toilet or sink. A new vanity is a legitimate purchase, but otherwise, you likely won’t see that great of a return on the money you spend.
You should also make sure you view the property like a house, not a home. You want to create a functional space that can withstand the wear and tear of renters and not cost you an arm and a leg to repair if things get damaged. This isn’t your home, so don’t choose things as if it were.
The Bottom Line
If you plan to renovate to rent, be sure you have a clear vision of what your rent amount is and how much rent you’ll need to collect to pay for your renovations. You don’t want to spend a large amount of money on renovations that aren’t going to justify a higher rent.
For even more interior design and decorating advice, check out our other blog posts.